From pioneering climate policy to political football: a new book looks at the rise and fall of the carbon tax

On Sept. 12, BC NDP leader David Eby dropped a bombshell: if re-elected, his government would get rid of British Columbia’s consumer carbon tax if the Trudeau government also removed a requirement for provinces to enforce their own carbon pricing rules. Yet months earlier, Eby defended the tax, mocking a letter from federal Conservative Leader Pierre Poilievre asking him to halt an April 1 increase as a “campaign office and baloney factory” request.

Now, a timely new book looks at the history of B.C.’s signature climate policy and its possible future.

“I think it will come back to bite Mr. Eby, frankly,” said Dr. Thomas F. Pedersen, a professor emeritus at the University of Victoria and author of The Carbon Tax Question: Clarifying Canada’s Most Consequential Policy Debate. He says he was both surprised and concerned by Eby’s remarks, given the NDP’s progressive track record on the environment.

Pedersen’s book looks at the genesis of B.C.’s price on carbon, which goes back to the government of BC Liberal Premier Gordon Campbell.

“He understood that the planet was being changed by human activity,” said Pedersen. “He said to his caucus, ‘We’ve got to do something about this.’ One of the drivers that caused him to make the decision to bring in a carbon tax was the [mountain] pine beetle infestation.”

---

John-Ackermann-speaks-to-Dr.-Thomas-F.-Pedersen-author-of-The-Carbon-Tax-Question

---

“What had happened was, because of global warming, we were no longer getting severe cold snaps in October and November of each year, and those cold snaps used to kill the beetles and prevent them from having large outbreaks,” he said.

“But because of global warming and the lack of those cold snaps, the beetle populations exploded in the late 1990s and through the early 2000s, swept across the province, and destroyed something on the order of $100 billion worth of pine forests.”

B.C.’s revenue-neutral carbon tax was introduced in 2008. The first of its kind in North America, it would soon become a template for the world.

The Trudeau government introduced its own price on carbon in 2019. Pedersen argues Ottawa’s biggest mistake in its handling of the tax was one of messaging.

“The government lost its way,” he writes, “focusing on the word environment, rather than on the phrase that speaks more directly to voters: revenue neutral.”

“I think they simply forgot that it was important,” he said.

“When [Canadians] buy gasoline or propane or natural gas, they need to know that they’re getting it back coming from the other side. That reminder needs to be given to them incessantly, as I say in the book, over and over and over again. That hasn’t been done.”

The other mistake, possibly a fatal one, was allowing an exception for home heating oil in Atlantic Canada. One of the stipulations Premier Gordon Campbell and his Finance Minister Carole Taylor laid out in the original carbon tax was that there were to be no exceptions and no free riders.

“When Justin Trudeau brought in this carve out last year, it was a total disaster,” said Pedersen. “It blew up very much in his face, and it certainly opened the door to Pierre Poilievre and his Axe the Tax campaign. And, as I have argued, they were going after the wrong target.”

Pedersen points out it wasn’t the carbon tax that made home heating oil more expensive, but the world price for oil.

But he admits the Conservatives, unlike the Liberals, have been very effective about communicating their message about the tax.

“Mr. Poilievre is not concerned about global warming. He’s only concerned instead about political power that he might gain by seizing on people’s fear of the increased cost of living. It’s not the carbon tax that’s doing that, because we’re getting the money back.”

Poilievre is determined to make the carbon tax a ballot box issue in the next federal vote, going so far as to call it a carbon tax election.

The Carbon Tax Question reads like a rise and fall story, but Pedersen remains hopeful. He doesn’t see the book so much as a call to action so much as an opportunity for Canadians to know the facts.

“I want people to understand how complex the issue is, that there are solutions. I think every Canadian needs to appreciate that global warming is real,” he said.

“There are economic opportunities there in dealing with that challenge. Let’s seize those, and the best way to seize them is to put a price on pollution that drives investment into those areas that will meet the challenge.”

The Carbon Tax Question: Clarifying Canada’s Most Consequential Policy Debate is available from Harbour Publishing.