A great man once said, "Politics is inherently stupid." That great man was me.

Wednesday, June 11, 2008

Stéphane Dion: Then and Now

May I suggest he gets his story straight before he releases this nebulous 'plan' of his?

Stephane Dion — 2006: A carbon tax is less effective than a carbon market at reducing emissions. Some of my opponents for the Liberal leadership have suggested that a carbon tax would be the most effective measure to curb climate pollution. This is simply bad policy, for the following reasons:

A carbon tax is almost always implemented as a direct tax on fossil fuels. Given the current price of these fuels, however, it is difficult to argue that a further price signal will dampen consumption or shift demand.

A carbon tax is a flat tax – it costs each polluter a fixed amount per tonne of emissions. Such a tax will not inflate with a bull market or recede in times of difficulty. In the energy market, in particular, soaring prices make anything but a prohibitively high tax a mere nuisance for large producers.

Finally, and most significantly, valuing reductions in emissions equally across all sectors and industries eliminates the potential benefits to be had by maximizing reductions where the cost is lowest. In a carbon market, those areas that produce the least expensive real reductions will experience the highest level of interest and investment, maximizing the level of reductions per dollar spent.
2008: Dion says Canadians willing to accept carbon tax **

H/t National Newswatch

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