Carbon tax: good policy; good politics

Ever since the failure of Stephane Dion and the federal Liberal Party in 2008 to sell Canadians on the idea of a carbon tax, conventional wisdom has held that raising taxes on greenhouse gas emitting fuels for environmental purposes is political suicide.  But, conventional wisdom, as economist John Kenneth Galbraith pointed out, often conflates “truth with convenience, with what most closely accords with self-interest and personal well-being”.  So it is with carbon taxes – it is convenient for some to argue that they are politically impossible, since the surest way to kill an idea is to convince others that it is unfeasible.

It turns out, according to a recent article in The Economist, that British Columbia’s carbon tax is not only feasible, but has become politically popular and effective in reducing greenhouse gases. A recent poll of British Columbians found that carbon taxes rank as second only to taxes on corporations as their favourite way to raise revenue. Despite earlier controversy, all parties in the BC legislature now support the tax.  Something for Manitoba’s provincial leaders to consider as we head into a provincial election.