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Terence Corcoran just wrote a great article exposing the new federal carbon pricing plan for what it is: an inefficient, ineffective tax that will increase the burden on industry and drive up costs for consumers.

The price starts at $10/tonne and will climb to $50/tonne over the next five years. He notes that the tax will “[raise] the price of all products,” while failing to meet Canada’s 2030 emissions target. A 30% reduction in 12 years would take a $200/tonne carbon tax, and a host of other regulatory changes.

“The carbon-tax system, and all its accompanying regulatory paraphernalia, is not a mere tax grab,” he writes. “It is a giant multibillion-dollar tax bulldozer rolling through the economy accompanied by an entire fleet of heavy regulatory equipment.”

As Corcoran sees it, that’s the biggest irony. Carbon pricing was supposed to reduce the need for regulation. Instead, it’ll work in tandem with all manner of subsidies and regulations to make our economy increasingly uncompetitive.  

This blow to our economy will have consequences for the environment as well, in the form of carbon leakage. 

If Canadian industry becomes uncompetitive, production will just shift to other jurisdictions – including countries which lack our robust environmental standards. As a result, GHG emissions could actually increase, meaning the economic pain we suffer will be for nothing.

Carbon pricing is not the solution for the planet, and suppressing Canadian industry will not reduce emissions.

P.S. For more information on carbon leakage and the economic costs of a carbon tax, check out the Conference Board of Canada's 2017 report The Cost of a Cleaner Future.