Like The Hub?
Join our community.
Join

Sean Speer: Canada’s climate activists want to be taken seriously but not literally

Commentary

The Public Policy Forum (disclosure: where I am a senior fellow) recently released a major paper on Canada’s climate goals and the implications for the oil and gas sector. It’s a must-read for anyone interested in climate policy and the inherent trade-offs in different policy approaches. 

Yet the paper has been criticized in some policy quarters for various reasons including, for instance, that it doesn’t properly account for the economic benefits of cultivating fossil fuel alternatives. (The researchers who produced the analysis have responded to this particular critique.) 

The main criticism however is about the scenarios that the paper models to meet Canada’s goal of net-zero emissions by 2050. The argument seems to be that the paper is wrong to account for the actions and words of environmental activists when it comes to “keep[ing] the oil in the ground” or “landlock[ing] the oil sands” or the need to “phase them out” altogether as the prime minister said in 2017. It amounts to something of a Trumpian expectation: they’re to be taken seriously but not literally. 

The paper essentially puts forward two scenarios. The first envisions the phaseout of the oil and gas sector between 2035 and 2050. The second scenario is described as “aggressive decarbonization” by which oil and gas production is able to continue based on a combination of lower emissions intensity in the sector and net-zero emissions across the economy as a whole. 

According to the PPF’s analysis, both scenarios achieve the goal of net-zero emissions by the middle of this century but they’re far from equal in terms of their economic impact. Canada’s economy would grow at a rate that’s 0.1 percent slower per year under the phaseout scenario than aggressive decarbonization. The net effect is we’d give up $100 billion in economic activity in 2050—a three percent reduction of the overall economy. It represents, as the authors put it, “a deep recession without a recovery ever materializing.” 

These economic consequences could be significant especially given the sector’s heavy concentration in Alberta and the disproportionate role that the fossil fuels industry has played in sustaining Canada’s middle class over the past quarter century or so. As the paper explains: 

Navius tested this result under different assumptions and, while the number [with regards to the employment and wage effects] was sometimes higher or lower, the direction was always the same when Canadian workers lose one of their most productive and highest-paying sectors under the accelerated phaseout model. Think of the hollowing out of the U.S. Midwest with workers going from pay of $30 or more an hour to something closer to half that.

The key takeaway seems self-evident: any credible climate policy should aim to lower emissions in the oil and gas sector on a net basis rather than eliminate them and the sector itself altogether. 

The paper’s critics have nevertheless generally avoided these key findings and instead dismissed the phaseout scenario altogether as unrepresentative of mainstream voices (“it’s not actually on the table”) including among those who favour stringent climate policies such as a sector-specific emissions cap for oil and gas. 

At the risk of sounding biased, these criticisms strike me as unfair. They involve some cognitive dissonance on the part of environmental groups, adjacent academics, newspaper columnists, and others. Many of these critics effectively want to be able to oppose oil and gas projects at the permitting stage, protest them at the construction stage, and then claim that it’s a mischaracterization of their position to say that they’re in favour of phasing out the oil and gas sector. The power of so-called “revealed preferences” is telling here. 

Even the government’s plans for a sectoral emissions cap (which is anticipated by the end of the year) could effectively function as a production cap depending on its stringency. Although the government’s Emissions Reduction Plan envisions emissions from the oil and gas sector to fall by 31 percent in 2030 based on 2005 levels, environmental groups such as Environmental Defence have called for a 60 percent reduction. The latter (especially if accompanied by the withdrawal of financial support for carbon capture and storage technologies as the Environmental Defence has also advocated for) would almost certainly require production cuts in order to comply. 

And then there’s the bigger question about whether government policy ought to single out the oil and gas sector in the first place. It’s confusing that groups like the Canadian Climate Institute which have championed carbon taxes because of their efficiency and neutrality now also support a stringent emission cap on the oil and gas sector with no scope to account for emissions reductions elsewhere in the economy. The latter would seem to undermine the case for the former. 

It prompts the question: What’s the point of a decentralized pricing mechanism if we’re going to impose central planning anyway? The answer would seem to validate a conservative critique of Canada’s climate policy that we’ve increasingly ended up with the worst of both worlds. 

As economist Trevor Tombe has written for The Hub, the most efficient climate policy remains one that treats emissions consistently across regions and sectors. That means generally resisting calls for caps, mandates, and subsidies, and instead trusting the market to drive economy-wide emissions reductions. 

The alternative, which appears to be finding growing support, is costly. The PPF’s report is an instructive reminder of how significant those costs could ultimately be.  

‘They had six years to order changes’: A chief of staff explains why the Johnston report ‘doesn’t compute’

Commentary

Former governor general and independent special rapporteur David Johnston released his report on foreign election interference this week, recommending against a public inquiry into the issue. Johnston also dug into how intelligence reports find their way through the bureaucracy and why some important documents were missed by key people in the government. The Hub’s editor-at-large Sean Speer spoke with Ian Brodie, the former chief of staff to Stephen Harper, for some insight into how governments handle classified and top secret information.

SEAN SPEER: One of David Johnston’s key findings is the following: “Staff at the PMO speak of being given a large binder in a secure room with an agency client relations officer present, a short time to review it, with no context or prioritization of the material, and no ability to take notes (for security reasons). The binder may have a significant mix of topics from around the world, and no one says, ‘you should pay attention to this issue in particular.’ If staffers are away, they may not see the binder that day.” This sounds pretty sub-optimal. Is that consistent with your experience?

IAN BRODIE: I don’t understand this part of the report. When Mr. Trudeau’s chief of staff testified at committee recently, she spoke of a system in which she was briefed regularly and nothing was withheld from the prime minister. Of course, anything that is reported to PMO is assumed to be important, otherwise it wouldn’t be sent over. Whenever I had questions about a report I received, I found the agencies were quick to get back with clarification or further background. The Privy Council Office has its own in-house intelligence analysis group, the International Assessments Secretariat, and I eventually got to know many of the analysts who worked there.  

SEAN SPEER: One of the more shocking findings is that intelligence concerning the PRC’s targeting of MP Michael Chong was sent to the Public Safety Minister and his chief of staff via a Top-Secret Email Network but they did not read it because they did not have access to the network. Does that make sense to you? How did you tend to access and review intelligence materials?

IAN BRODIE: I have no idea how Mr. Mendicino’s office works, but this part of the Johnston report doesn’t compute with me. I received intelligence reporting on paper and with in-person briefings because I did not have a Top-Secret facility in my office. Intelligence analysts were always on hand to provide background as to why a report was in my folder that day. I assume Mr. Mendicino meets regularly with his deputy minister — ministers are expected to make time to meet with their department officials regularly — and I am sure his deputy would have been able to hand-deliver intelligence reporting at one of these meetings. Again, given that this intelligence report dealt with a foreign government’s effort to punish a MP’s family for a vote taken in the House of Commons, I cannot imagine any official, let alone a deputy minister, deciding not to send that report to the minister. And if the minister refused to take it, to have PCO intervene to make sure the reporting was shared with political people — ministers and senior political staff.  

SEAN SPEER: How much are these issues concerning the distribution and use of intelligence within the government a function of legal and policy factors versus the actions and preferences of the political arm of the government? That is to say, how much influence does PMO and the Cabinet have on the culture and processes of intelligence sharing and briefings?

IAN BRODIE: I only know how these matters were handled when I was chief of staff. I thought the reporting was important, I made it clear I would make time to be briefed, and I often asked follow up questions that required follow up reporting. I visited several intelligence agencies in person while I was chief of staff. Mr. Harper read a great deal of intelligence reporting and acknowledged he had read it in writing.  

If the PM and his ministers found their national security briefings were not helpful to them, my goodness, they had six years to order changes before the Chong report was issued.

SEAN SPEER: What did you take away from the report? Was there anything that surprised you?

IAN BRODIE: Johnston is correct: relying on seriatim media reports of bits and pieces of intelligence reporting can give the reader an incomplete picture of what was known and when it was known. Simply saying “trust us, it’s fine” is even less helpful. What would help everyone understand what was going on?  A full, public inquiry that prepares a full report to everyone.

We sometimes forget — this is how CSIS came to be in the first place. There was a full, frank and public inquiry into covert operations of the RCMP security service. The inquiry revealed many covert details about the security service’s operations and tactics. The inquiry thought Canadians could be trusted will the whole truth, and the government of the day created CSIS in response.