Cap and Trade

[bornagainbiking]

Is this a good idea for Ontario?

[haljackey]

If done right, absolutely.

However we don't really have a lot of detail at this point. Not a lot of answers... seems like a cash grab / extra tax right now.

If more provinces / countries follow, we could lead by example. That would be good for our reputation. Hopefully we can pull it off successfully, but I have my doubts.

[1overcosc]

Our best hope for clues is Quebec's operational cap-and-trade program, as every indication is that we're following Quebec's lead on this.

Quebec actually gives a number of free 'exception credits' to businesses that are in direct competition with businesses in jurisdictions without any carbon programs (cap-and-trade, or a carbon tax, or direct regulation). That protects against what's called 'carbon leakage': businesses simply leaving and doing work in carbon-unrestricted places, which only serves to hurt the local economy and ultimately do nothing to reduce global CO2 emissions.

It's been determined that Quebec's cap-and-trade program has increased the price of gas by about two cents or so.

As for revenue, I think the estimates are that we could be getting somewhere in the neighbourhood of $1B-$2B annually. The government has said it's going to be sweatered to environmental programs. One use of that money that I'd like to see is increased dedicated operational funding for public transit (as opposed to the $29B plan that was implemented last year, which provides capital funding for transit). Currently the province spends about $300M a year on the gas tax grant program which gives money to municipal transit agencies. I'd like to see the government double or triple that amount with the cap-and-trade revenues. That would a boon for transit service in the province as most cities are struggling with operational funding (notably, both York Region & Ottawa are seeing stagnating transit ridership due to operational funding challenges).

[MoreTrains]

Good Idea: Theoretically reduces GHG emissions.

Bad Idea: Increases price of Electricity, Heating, Gasoline and food

Good Idea: Reallocates emissions from a 'greener' industry to another industry and requires a tax on overages

Bad Idea: A company can always buy more credits from the government

Good Idea: Looks good to the electorate

Bad Idea: Costs associated with Cap and Trade are picked up by the lower income consumer without any assistance

Overall I think Cap and Trade is crap. There are better systems that should have been implemented that protect those of lower income and keep cost increases down. Fee and Dividend system would be much better.

http://www.thestar.com/opinion/lette...and-trade.html

[1overcosc]

Carbon taxes have the same effect on the poor but a worse effect on the economy, so I'd say they're a worse option.

The government is about to introduce a 20% electricity discount for low-income households (replacing the 10% discount for everybody). In any case, as electricity in Ontario is already mostly carbon-free as a result of the coal phase out, the effect on electricity prices is small.

[MoreTrains]

Originally Posted by 1overcosc

Carbon taxes have the same effect on the poor but a worse effect on the economy, so I'd say they're a worse option.

The government is about to introduce a 20% electricity discount for low-income households (replacing the 10% discount for everybody). In any case, as electricity in Ontario is already mostly carbon-free as a result of the coal phase out, the effect on electricity prices is small.

Cap and Trade still is a tax, but the money for GHG credits goes between companies and the province only gets the tax on the transaction. And as the article I posted said, it still wont help the environment, as any company that doesnt want to pay to get extra credits they just move to Manitoba, or the US; thus there will still be a negative effect on the economy.

That discount is all and well, but 20% off 500 is still 400. Plus the fee isnt just for the production of the electricity, but all the products required to distribute it. Those materials will increase in price because of their production and trasportation costs. And considering how much work needs to be done on electrical distribution infrastructure it will likely negate the 'greeness' of our production.

And I dont believe electricity is the biggest issue with a Cap and Trade system, but the effect it will have on food prices. Since farms are companies, they will be given an allocation of emissions they are allowed and thus will be required to pay to get more credits if needs; as will the transport trucks that move the food to market.

Im curious how the government will measure emissions? Meters on all tail pipes or what?

[haljackey]

Even the Ontario Green Party is skeptical of this: http://www.gpo.ca/blog/2015-04-14/we...trade-cap-hand

[1overcosc]

Originally Posted by MoreTrains

Cap and Trade still is a tax, but the money for GHG credits goes between companies and the province only gets the tax on the transaction. And as the article I posted said, it still wont help the environment, as any company that doesnt want to pay to get extra credits they just move to Manitoba, or the US; thus there will still be a negative effect on the economy.

Read my explanation of exception credits that I gave above. This solves that problem.

Originally Posted by MoreTrains

Im curious how the government will measure emissions? Meters on all tail pipes or what?

I have no idea, but seeing as how many other jurisdictions have implemented cap and trade programs, it's not a difficult problem.

[1overcosc]

The cap and trade idea is being received well by the public with two-thirds of Ontarians supportive.

This surprises me. I would have expected implementing it to be more popular than not, but not quite by this margin (If I had to guess, I would have said 40% in favour, 35% against, 25% undecided/unsure).

http://www.theglobeandmail.com/repor...ticle24602595/

[1overcosc]

New research in: 65.8% of Ontarians support carbon cap-and-trade including a majority in every single riding.

http://www.theweathernetwork.com/new...climate/64015/

http://umontreal.ca/climat/engl/index.html

The PC party's continued opposition to this is politically dangerous. If they were smart they'd drop their opposition. They have been increasingly quiet on the issue (as opposed to their angry protests in the beginning), so maybe that's a sign they're reading the writing on the wall.

[eternallyme]

Originally Posted by 1overcosc

New research in: 65.8% of Ontarians support carbon cap-and-trade including a majority in every single riding.

http://www.theweathernetwork.com/new...climate/64015/

http://umontreal.ca/climat/engl/index.html

The PC party's continued opposition to this is politically dangerous. If they were smart they'd drop their opposition. They have been increasingly quiet on the issue (as opposed to their angry protests in the beginning), so maybe that's a sign they're reading the writing on the wall.

If you change the question to the taxes issue though, once outside of the GTA and other urban ridings support drops dramatically. Support for carbon-based taxes (which is what this appears to be with the talk of gas taxes increasing) is as high as 70% in downtown Toronto and as low as 35% in some of the rural ridings. I think there is a lot of confusion about "cap and trade" - remember even Harper supported it at first until his party's supporters screamed.

Can the PC's form government without the support of the 25-30% or so of the electorate that takes hardline positions though? Remember even in 2015 Harper got about 34% of the vote in Ontario despite Red Tories consolidating around Trudeau. Obviously they can't form government with just that (the result with them getting 34% in a provincial election would be a Liberal majority with the new boundaries), but if they stayed home or voted for a new party, the Liberals would breeze to a near clean sweep.

[HillStreetBlues]

Originally Posted by eternallyme

If you change the question to the taxes issue though, once outside of the GTA and other urban ridings support drops dramatically. Support for carbon-based taxes (which is what this appears to be with the talk of gas taxes increasing) is as high as 70% in downtown Toronto and as low as 35% in some of the rural ridings. I think there is a lot of confusion about "cap and trade" - remember even Harper supported it at first until his party's supporters screamed.

"The GTA and other urban ridings" are enough to win a majority government.

Carbon taxes (whether as taxes or by the name of cap and trade) are supported by most Ontarians in most part of Ontario. I don't think you even need to be a particularly Red Tory to support it- if you are a conservative and understand climate change is a problem, taxing carbon is a good way of setting a signal and letting the market find solutions.

Can Tories just stay home- let alone vote for a new party? I'm really asking. It seems to me that your 25-30% who take "hardline" positions have little other place to go. The Liberals have really tacked left, and surprisingly it's worked for them. It doesn't make a lot of sense for the Tories to tack right and let the middle flip a coin as to which extreme they can most readily tolerate. They are supposed to be a big tent- this is a merger of the progressives and the conservatives, remember.

[1overcosc]

In many ways, you could argue that the Wynne Liberals have left a gaping hole on their right flank by moving leftward. At first this seemed crazy, but it's starting to make sense. Stay on the left to keep the NDP down, and know that the PCs will never move to claim the centre.

Today's budget definitely reaffirms the Wynne Liberals as leftists. As soon as the economy picking up gave her extra money to work with, she ploughed it right into social spending rather than using it to accelerate deficit reduction or cut taxes.

[Loco101]

Originally Posted by HillStreetBlues

"The GTA and other urban ridings" are enough to win a majority government.

Carbon taxes (whether as taxes or by the name of cap and trade) are supported by most Ontarians in most part of Ontario. I don't think you even need to be a particularly Red Tory to support it- if you are a conservative and understand climate change is a problem, taxing carbon is a good way of setting a signal and letting the market find solutions.

Can Tories just stay home- let alone vote for a new party? I'm really asking. It seems to me that your 25-30% who take "hardline" positions have little other place to go. The Liberals have really tacked left, and surprisingly it's worked for them. It doesn't make a lot of sense for the Tories to tack right and let the middle flip a coin as to which extreme they can most readily tolerate. They are supposed to be a big tent- this is a merger of the progressives and the conservatives, remember.

The progressives don't seem to be very welcome in the PC Party anymore. When Mike Harris was Premier, quite a few of his cabinet ministers were moderate. I now see very few moderate PC MPPs. And the new leader Patrick Brown isn't helping. When it comes to environmental issues. the PC Party needs to at least focus on a few things where they will take positive action and please at least some environmentalists. The party won't win unless they come up with at least some progressive ideas in all areas.

[1overcosc]

Brown has definitely toned down the PC opposition to cap and trade.

In his reaction to today's budget announcement, the words he used on cap and trade were: "My worry is that we’re going to see the government taking advantage of the good will the public has on wanting to combat climate change as simply a revenue grab."

Stopping well short of actually endorsing a plan on climate change, but avoiding directly criticizing the cap and trade concept.

[eternallyme]

Originally Posted by 1overcosc

In many ways, you could argue that the Wynne Liberals have left a gaping hole on their right flank by moving leftward. At first this seemed crazy, but it's starting to make sense. Stay on the left to keep the NDP down, and know that the PCs will never move to claim the centre.

Today's budget definitely reaffirms the Wynne Liberals as leftists. As soon as the economy picking up gave her extra money to work with, she ploughed it right into social spending rather than using it to accelerate deficit reduction or cut taxes.

This press release from Ontario's most left wing union would suggest otherwise, that they are Mike Harris reincarnated (but I doubt they would be happy even with an NDP majority government)...even more moderate unions aren't attacking them like that.

https://opseu.org/news/wealth-transf...us-thomas-says

[1overcosc]

Originally Posted by eternallyme

This press release from Ontario's most left wing union would suggest otherwise, that they are Mike Harris reincarnated (but I doubt they would be happy even with an NDP majority government)...even more moderate unions aren't attacking them like that.

https://opseu.org/news/wealth-transf...us-thomas-says

OPSEU is very radical. You're correct in that even an NDP majority government scenario would get them angry.

[Loco101]

Being a member of the federal public service, I know that no political party when in power is liked by the public sector unions.

[Loco101]

Back when Mike Harris was Premier, I remember his government's initiatives including the "Lands for Life" where large amounts of land would be set aside and remain untouched. Also there was "Ontario's Living Legacy" which was quite similar. I also remember the PC government creating the "Great Lakes Heritage Coast" from those initiatives.

If the Liberals or NDP did those things today many conservative supporters would be very upset. I just couldn't see the current ON PC Party doing what even Mike Harris did.

[eternallyme]

Originally Posted by Loco101

Back when Mike Harris was Premier, I remember his government's initiatives including the "Lands for Life" where large amounts of land would be set aside and remain untouched. Also there was "Ontario's Living Legacy" which was quite similar. I also remember the PC government creating the "Great Lakes Heritage Coast" from those initiatives.

If the Liberals or NDP did those things today many conservative supporters would be very upset. I just couldn't see the current ON PC Party doing what even Mike Harris did.

Even during the Mike Harris years, there were many moderates who didn't seem to agree with his more radical policies. Now that urban areas have largely become Liberal and urban Red Tories have largely gone to them as well, rural areas call the shots and they would rather have Monte McNaughton or Randy Hillier as leader if they knew they didn't need to compromise.

Also note that many of the current PC ridings (some of which are held by hardline Tea Party types) did NOT go to the Mike Harris PC's during those days, meaning that old school liberalism was still alive and well to some degree. That increased the urban influence on the party even more relative to today.