Trudeau is right, but that’s irrelevant; no one believes him

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This article was published 28/03/2024 (580 days ago), so information in it may no longer be current.

For reasons that are not entirely clear, Prime Minister Justin Trudeau is unwilling to admit he has lost the national argument over carbon taxes.

In a pre-budget barnstorming tour of the country, Trudeau continues to argue the underlying logic of carbon pricing is sound, and the facts show his government’s carbon levy has less of an impact on inflation than critics claim.

Trudeau has also continued to maintain that the accompanying rebate program actually provides most Canadians at the lower end of the income scale — the people who need relief from the high cost of living — with more than they pay in carbon tax.

If you take the time to drill down into the numbers, Trudeau is not wrong on either point. The problem is, he simply cannot convince anyone he is right.

The sheer size of the constituency that opposes the April 1 increase in carbon taxes has grown to the point where it cannot be ignored.

Most premiers oppose another increase in the tax, and they are joined by most of the leaders in opposition parties in those provinces. Meanwhile lobby groups, including the Canadian Taxpayers Federation, continue to sound a shrill condemnation of the measure.

However, no one has driven the anti-carbon tax movement more than Conservative Leader Pierre Poilievre, who has pinned much of his future electoral hopes and dreams on whipping up and sustaining a high-pitched contempt over the Trudeau government’s carbon policies.

Poilievre brings his “Axe the tax” roadshow to Winnipeg tonight, complete with the branded T-shirts that have become so recognizable in recent weeks.

Measure the growing magnitude of the anti-carbon tax community, and you can see there is little or no chance Trudeau is going to somehow magically change hearts and minds on this issue before the next election. Not that he and some knowledgeable third parties aren’t still trying.

This week, more than 300 of the country’s leading economists signed an open letter that challenges Poilievre’s claims about the tax, which calls several of his talking points “myths.”

The economists argue the carbon tax and the rebates are the most cost-effective way of helping lower-income Canadians while also providing a incentive to higher-income earners to find ways to reduce their consumption of fossil fuels.

Perhaps fuelled by that support, Trudeau went on the offensive, suggesting in Ottawa Wednesday that the premiers who oppose the federal levy have been “misleading Canadians” and “not telling the truth.”

Notwithstanding the prime minister’s counteroffensive, he has largely lost the public relations battle on this issue. How and why is a story that reveals both Trudeau’s inherent weaknesses in communication, along with the public’s irrational capacity to swallow misinformation.

To wit: a lot of the debate over carbon taxes has focused on whether Canadians get more in rebates than they pay in taxes. Much of the debate is driven by a controversial study by the parliamentary budget office.

The office report found that on average, Canadians pay several hundred dollars more in carbon tax than they receive in rebates. However, the data shows eight in 10 Canadians who live in provinces that use the federal carbon tax receive more in rebates than they pay in carbon tax.

The disparity between the findings is the result of an irrefutable reality: a greater number of lower-income citizens burn considerably less fossil fuel and receive considerably more in rebates than a much, much smaller number of higher-income Canadians who, quite frankly, are much better positioned to weather the higher prices of fossil fuels.

Not only do Canadians seem unable to process this data, they dispute the notion they even receive a rebate.

Every tax-filing household in the eight provinces that employ the federal carbon tax — approximately 12 million people — receive a rebate. Yet, opinion surveys consistently show that roughly half of all respondents claim they did not.

Ottawa has theorized that this is because 81 per cent of those who receive a rebate get it in the form of a quarterly direct deposit, which is less noticeable than receiving a cheque.

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The other part of the debate that Trudeau has lost is counteracting allegations that carbon taxes have been a major driver of inflation.

Anything that provides upward pressure on the prices of goods and services has a role in driving inflation. But macro forces, such as supply and demand, global trade dynamics and price-gouging, play a much bigger role than a single levy on a single commodity that has a minimal impact on the overall price of goods and services.

That is pretty much what Trudeau has been trying to tell people about the carbon tax. He’s just failed to get his message across.

The end result for the prime minister is that the longer he tries to prove that he is right on carbon taxes, the greater the chance he will end up being so colossally wrong.

dan.lett@winnipegfreepress.com

Dan Lett
Columnist

Dan Lett is a columnist for the Free Press, providing opinion and commentary on politics in Winnipeg and beyond. Born and raised in Toronto, Dan joined the Free Press in 1986.  Read more about Dan.

Dan’s columns are built on facts and reactions, but offer his personal views through arguments and analysis. The Free Press’ editing team reviews Dan’s columns before they are posted online or published in print — part of the our tradition, since 1872, of producing reliable independent journalism. Read more about Free Press’s history and mandate, and learn how our newsroom operates.