GOLDSTEIN: How to fight climate change without national carbon tax

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New Conservative leader Pierre Poilievre claims he can reduce Canada’s industrial greenhouse gas emissions without a national carbon tax. So did US President Joe Biden.

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That, of course, is not Prime Minister Justin Trudeau’s view. He says a national carbon tax/price is the most effective way to reduce climate change-related emissions.

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Which begs the question of why the US has been more successful in reducing emissions than Canada without one. Both countries had set themselves the goal of reducing emissions by 17% below 2005 levels by 2020.

Americans cut them by 21% without a national carbon tax. Canada reduced them by 9% with a national carbon tax.

The different approaches in Canada compared to the US date back to Canada’s signing into the United Nations Kyoto climate agreement in 1997 by former Liberal Prime Minister Jean Chretien. In doing so, Canada committed to reducing emissions by an average of 6% below 1990 levels from 2008 to 2012, although a senior adviser to Chretien later admitted the Liberals knew they could not meet that target.

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Although global warming guru Al Gore was vice president of the Bill Clinton administration at the time, the US rejected Kyoto after the US Senate said it would hurt the US economy.

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US President Barack Obama, who co-signed the Paris climate accord with Trudeau in 2015, failed to introduce a national cap-and-trade regime – a carbon tax by another name – in 2010 for the same reason.

(In the 2008 federal election, Stephen Harper’s Conservatives supported a national cap-and-trade system because they believed the US would introduce one, leaving Canada no choice but to do the same. As a cap-and-trade in rejected by the Conservatives in the USA, the plan was abandoned.)

What the Americans did that Canada didn’t do was allow it Market constraints reduce emissions.

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For example, while Canadian provinces banned fracking, Americans used it to unlock vast reserves of natural gas, making it economically advantageous to replace coal-fired power with natural gas. Because natural gas burns at half the carbon intensity of coal, U.S. emissions have fallen dramatically.

The G-7, which includes Canada and the US, and the European Union classify natural gas as a transitional form of green energy.

All of which brings us to Biden’s $370 billion climate plan, approved by Congress in August, which does not include a national carbon tax.

It provides hundreds of billions of dollars for US consumers to buy electric vehicles and other green energy products and services, and for America’s manufacturing and industrial sectors to develop and adopt new sources of green energy.

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It also gives the American oil and gas sector better access to offshore drilling in the Gulf of Mexico and Alaska, expanded tax credits for coal-fired and natural gas-fired power plants that use carbon capture technology, incentives to build wind and solar projects in coal-mined areas or Coal-fired power plants have been closed, and $60 billion to low-income and minority communities disproportionately impacted by climate change.

It includes penalties for industries that exceed US methane emissions limits beginning in 2024, but nothing remotely close to a national carbon tax like the one we have here.

Biden pledges to cut US emissions by 50% below 2005 levels by 2030, while Trudeau pledges a 40% to 45% cut. Lets see what happens.