
Canada has a major economic opportunity in the global low-carbon economy, if it gets its climate and energy policies right. Those policies should be informed by principles like leveraging the ingenuity of markets and free enterprise, limited government, and respect for provincial jurisdiction. The following article is the latest installment of The Hub’s series sponsored by Clean Prosperity exploring the why, what, and how of conservative climate policy.
When it comes to climate change policy in Canada these days, regular Canadians aren’t the only ones, to paraphrase Irving Kristol, getting mugged by reality. Andrew Furey, Bonnie Crombie, Jagmeet Singh, and David Eby—all Liberal and NDP leaders—are running away from the consumer carbon tax as fast as their legs can carry them. These are some of the same leaders who only a few years ago would have sold their souls for a selfie with Greta Thunberg.
Trudeau’s Liberals, governing by a thread, are the only ones who continue to cling to the false premise that when Canadians say they want action on climate change, what they mean is they want to go broke.
So, what changed?
Two things. One, the facts on the ground caught up to the ideas in theory. Not only did the carbon tax keep ratcheting up (by design) just as inflation raged, but global energy markets were disrupted by Russia’s invasion of Ukraine, making it even more baffling that Canada couldn’t get our natural gas to tidewater. Not only was the economy sluggish and cost-of-living concerns moving into crisis, but the government was also shoveling taxpayer money out the door to for-profit companies, making inflation worse, all in the name of net zero.
And two, Canada’s Conservatives elected a leader who had never really given up on arguing that the problem with the carbon tax was a feature, not a bug, and who takes an almost sick pleasure in tearing apart ill-thought-out theories with inconvenient facts.
As soon as someone was willing to challenge the impractical, expensive theories that carbon emissions respect sovereign borders, that Canadians have an option not to heat their homes in the winter, that nuclear is less important than other green energy just because it’s not trendy, or that arguing against any of the above makes you a climate change denying troglodyte, Canadians gave themselves permission to agree.
Now with the current federal government set for likely defeat and some provinces changing their tune, we have an opportunity to chart a new course. If the last decade’s climate policy was defined by naïveté, the next one should be defined by realism. Not denialism, not head-in-the-sand-ism, just sound, realistic policies founded in evergreen principles.
Speaking of principles, let’s start with federalism and subsidiarity. We know now that the consumer carbon tax is toast. But what of the patchwork of provincial policies that price carbon on the back end to incentivize industry to reduce emissions over time? Some will say the next federal government must meddle in provincial jurisdiction, forcing a legislated backstop as the Trudeau government has done.
But this would fly in the face of our constitutional reality and our federalism framework at its most functional. Just as with school food programs, dental care, and childcare, the Liberal government’s sweeping ambition and grand vision have run up against the cold hard reality on the ground. We’re a big country and provinces have different scales, weather, cultures, and economies. They should be empowered to chart their own paths on climate policy, each politically responsive to their unique circumstances.
And if they’re allowed to do so, most if not all are likely to create, maintain, or even enhance some form of output-based carbon pricing (thus preserving functioning carbon markets and the country’s progress against national emissions reduction targets), particularly as their voters look for a balance between climate actions and economic relief.
On the matter of emissions, markets, and targets, Canadian climate policy must be savvier about foreign policy and trade. Despite a seeming disdain for borders when it comes to immigration, national security, and even patriotism, Liberal climate policy grants an extraordinary amount of power to Canada’s borders, naively suggesting that if Canadians bear the brunt of economically punitive policies, keeping our abundant natural resources in the ground and taxing our population into submission, we’ll have a major impact on global carbon emissions. This despite the reality that much bigger countries around the world are indiscriminately burning the resources supplied by much nastier regimes and trading their carbon-intensive materials with some impunity.
If Canada is going to take on some of the hardship of climate change mitigation, the value of our more cleanly-produced resources must be recognized in global trade. Whether through savvier negotiations at global trade and climate summits, or through policy solutions like a carbon border adjustment, when it comes to climate policy, we must place some value on our borders and put Canada’s national interest first.
Finally, a realist climate policy would prepare more wisely for the future. Canada has a lot of energy the world needs, including the oil and gas to meet global demand, and we have innovators and business leaders investing in developing, commercializing, and scaling the next clean energy technology. New can be sexy and way more fun to talk about, but a realist climate policy would spend way more time on the most reliable clean energy we have: hydroelectricity and nuclear power.
Conservatives do talk about nuclear a lot, but that’s because the environmental Left is bafflingly opposed to it. Not only did the current environment minister once notoriously campaign to shut it down, but until recently, the federal government excluded nuclear from green energy financing. A new government should run at hydroelectric dam and nuclear opportunities, tackling rising energy demand and climate policy in one fell swoop.
Preparing for the future also means getting serious about adaptation. Governments taken in by climate policy naiveté can be reluctant to focus too much on adapting infrastructure to a new climate reality. Perhaps it feels defeatist. But a realist climate policy would focus less on regulating resource development into submission and more on building resilient infrastructure for the future. Economic growth and prosperity always come with trade-offs. We ought to face them head-on.
Ultimately, a wise climate policy will reject that which seems only to cater to appearances. It won’t work back from artificial targets for the purpose of fitting in at global climate conferences but rather will work forward from core principles—fair trade, jurisdictional respect, strong economic growth, reasonable cost of living, and lower carbon emissions over time—and apply them to a hard-nosed analysis of the facts.
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