John Ivison: The carbon tax is collapsing and could take Trudeau down with it

The social movements for which this government has been the expression are turning against it. It seems impossible that it can stagger on for another two years

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It must have seemed like a good idea at the time.

In the fifth season of the hit ABC-TV sitcom Happy Days, the lead character, the Fonz, answers a challenge to his bravery by donning water skis and swim trunks, as well as his trademark leather jacket, to jump over a live shark.

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Ron Howard, a star of the show who would go on to become one of Hollywood’s top directors, remembers thinking “creatively, this was not our greatest episode” and the phrase to “jump the shark” is now wheeled out whenever someone or something is deemed to have introduced an idea completely contrary to the original mission.

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Justin Trudeau’s decision to exempt home heating oil from the carbon tax for the next three years was his “jump the shark” moment — one from which he may never recover.

A month before the Liberal government made the announcement on Thursday, Environment Minister Steven Guilbeault rejected the idea, saying it would be unfair for the rest of the federation if Ottawa carved out exceptions that would benefit the Atlantic provinces, where around 40 per cent of homes are heated with oil.

Three days before the announcement was made, Sean Fraser, the housing minister, stood in the House of Commons and said such a move would “make pollution free again.”

One wonders how those men are feeling now. Probably the same as former environment minister Catherine McKenna, who tweeted on Thursday: “Politics will break your heart.”

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This is not just any shabby political side-deal. It is core to the entire Trudeau project and could well see the entire carbon-pricing edifice collapse.

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Gerald Butts, Trudeau’s former principal secretary, once said that what he admired about the prime minister was that “he wanted to win with integrity, or lose.”

Those days are clearly in the past.

The carbon tax is, on balance, not a vote-getter. One poll by Spark Advocacy suggested that while 48 per cent are more likely to support the Liberals because of it, 52 per cent were more likely to support the Conservatives’ opposition. But, as Trudeau often argued, carbon pricing is the right thing to do. The government improved its structure last week by doubling the rebate for rural Canadians, who were probably not in a revenue-neutral position because they use more gasoline and have more expensive home heating bills.

Critics of the tax claim that it is not working; that Canada is only responsible for 1.5 per cent of the world’s emissions, so effectively, we should do nothing.

Yet, the early signs are that greenhouse gas emissions are not moving up in lockstep with economic growth: emissions rose 1.8 per cent from 2020 to 2021, while the economy grew 4.6 per cent. People are rational and respond to price signals. And as Edmund Burke once wrote: “Nobody made a greater mistake than he who did nothing because he could do only a little.”

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But those price signals have to be maintained — as the government well knows because in its carbon pricing schedule, it says that provinces that negate the price signal are offside and will be penalized.

The favouritism shown to one region has inevitably led to conservative provincial premiers Doug Ford of Ontario, Scott Moe of Saskatchewan and Danielle Smith of Alberta to call on Trudeau to extend the same pause to the much lower-emitting natural gas used by citizens in their province.

“This is the most divisive federal government Canada has ever had,” said Moe. “It’s not about climate change, not about fairness or about families, it’s only about votes.”

Moe has said that from January 1, SaskEnergy will stop collecting carbon tax on natural gas used for home heating, effectively giving Saskatchewan residents the same break as Atlantic Canadians. He defended what he acknowledged may be considered an illegal act because the federal government has created two classes of taxpayer.

Rural Economic Development Minister Gudie Hutchings indicated the West can eat cake when she told CTV Question Period that the home heating oil pause was the result of good work by the Atlantic Canada Liberal caucus and that “perhaps they need to elect more Liberals on the Prairies” to obtain similar results. As Moe pointed out, she was effectively saying western families are being punished because they didn’t vote Liberal.

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One suspects the tax pause on home heating oil will not be enough to appease Atlantic Canadian voters, who will have figured out that when the pause ends, the carbon tax on their home heating will be double what it is now.

The blatant unfairness is going to endanger what little representation the Liberals have west of Ontario.

And a lot of progressives who have stuck with Trudeau through the purchase of the TMX pipeline and broken promises over proportional representation will finally feel abandoned.

This is a decision that suggests carbon pricing can be amended at any point that it is politically expedient to do so. The whole system is in danger of collapse as a result, and it might take the prime minister with it.

Pierre Poilievre’s uncompromising position on the carbon tax has played a large part in Trudeau’s capitulation. Divisions in the camp of your rival don’t happen by accident, they are often the result of strong opposition policies. Let’s hope he has a plan to reduce emissions that he just hasn’t shared with anyone yet.

Trudeau is left looking like he is walking away from his defining political cause. He may as well have said he plans to pause all carbon tax increases for the next five years because of affordability concerns, which would be politically astute and no more unprincipled than pausing the tax in one region and not others.

This is a signature moment in the life of this government. The social movements for which it has been the expression are turning against it. The dynamism provided by conviction has been drained, leaving it appearing tired and out of touch.

It seems impossible that it can stagger on for another two years.

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Originally posted 2023-10-30 19:47:18.