Liberal Leader Stephane Dion has built a political career on bucking conventional wisdom. As intergovernmental affairs minister, he brushed aside the pundits and pollsters who said his Clarity Act would fan the flames of Quebec separatism and was proven right.
Today, he's brushing aside the pundits and pollsters who say his revenue-neutral Green Shift is political and economic suicide in an era of skyrocketing oil prices and fears of global recession.
He's going one step further. He's convinced the worse the situation becomes, the more Canadians will agree that it is economic suicide to do nothing.
"It's avoiding the issue that will hurt our economy. Economic fears are what is helping the debate," Dion said in a half-hour telephone interview from his office in Ottawa last Friday. "We are in the environment where the issue is so big, so unavoidable, that I'm confident Canadians will see that for their wallet and for the planet the Green Shift that we are proposing is a good solution."
Some commentators say the year 2008 is a watershed, the year when the three great challenges of the early 21st century -- climate change, the energy crisis and food shortage -- have merged. The future of humanity depends on addressing them as a single emergency.
Dion noted the British Conservative party is proposing a revenue-neutral carbon-income tax shift similar to his own. So is the director of the U.S. NASA research centre for energy. Australia has unveiled a climate change plan to create three million "green collar" jobs. Meanwhile, a confidential U.S. Congressional report just made public warns that climate change will create the risk of terrorism in many parts of the world.
The Liberal leader isn't about to soft-soap anyone. He doesn't deny that some parts of Canada -- and some Canadians -- will fare better than others, at least initially. He can't -- and won't -- buffer the fact that hydro-rich provinces like Manitoba, B.C. and Quebec won't see a carbon tax on their electricity rates, while hydro-poor provinces like Ontario, Saskatchewan and Alberta, which rely on coal or gas for power generation, will.
"Every climate change plan needs to decrease emissions where they are," he said. The "poorly designed" Conservative plan reflects that, just as do the Liberal and NDP proposals. "And it cannot be an excuse to do nothing; to say, as long as we don't have the same amount of emissions per province, we will do nothing."
Nor does Dion deny that Canadians who heat with oil will pay more than those who heat with natural gas. But he emphasizes that a carbon tax is a flat tax and does not rise with energy prices. It is linked, not to the price of oil and gas, but to the amount of CO2 emitted. Natural gas has much smaller carbon footprint than oil or coal.
He stresses the unique annual $15 billion in income tax cuts and credits that accompany his $15 billion annual carbon tax. At year four of his Green Shift, when carbon is taxed at $40 a tonne, the additional cost to heat a home with oil will be $205. But that will be offset by much higher income tax relief, especially for those with little means and in rural and northern areas.
Dion knows his toughest sell will be in Alberta and Saskatchewan. But he believes those provinces are where his economic arguments are the most compelling. Canada's oil exports could be in danger of trade retaliation if it continues to be a climate change "free rider," he continued.
"Only this week, you had the mayors of the U.S. saying that they don't want to import the oil sands of Canada. (Democratic presumptive presidential nominee) Barack Obama said that twice this week..."
He is also convinced the carbon tax's economic imperatives will leave both energy provinces with far more diversified economies.
When the oil companies are taxed on their profits, they call in their lawyers to "find a way to have less profits... to declare them abroad," the Liberal leader said. "If you tax less on their profits and more on their pollution... they will bring in their engineers instead and the engineers will tell them... change your investments for a few years and you will save taxes on renewable solutions, on sustainable solutions and then you create new activities... It's what Norway did. It's what Australia will start to do... They see (cutting CO2) emissions as an opportunity to become leading economies of the world..."
Earlier Friday, he promised a Saskatchewan radio audience they "will be at the centre of something big happening in the world, whether it is for bio-diesel, for CO2 capture and storage, for wind power..."
Dion pointed to a new study by the Canadian Centre for Policy Alternatives that found the richest 10 per cent of Canadians have a greenhouse gas footprint 2.5 times larger than the poorest 10 per cent. "So the carbon tax is not so regressive when you look at that."
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