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The Greens are right: Use economic clubs to battle climate change

From Friday's Globe and Mail

Good for Canada's Green Party. Last week, the Greens issued a policy to combat climate change that was the most arresting and innovative in Canada.

Parts of it were silly; all of it was ambitious. Predictably, it was largely ignored by the media. Who's interested in policy anyway, especially from the country's fifth party? Paris Hilton, murder trials and federal-provincial cockfights - now that's news.

If there's one issue on which Greens should be heard, it's the environment. That's why Greens exist. They believe - and apparently as many as 10 per cent of Canadians agree - that the existing political parties and governments don't get environmental issues.

At the heart of the Greens' climate-change policy is something as obvious as it is politically toxic: Economic tools are the best way to change behaviour. Subsidies and exhortation won't cut it. Price changes and markets might, or will. So the Greens propose a carbon tax, at levels that would raise the cost of a litre of gasoline (and other carbon-emitting products) by 12 to 24 cents.

The Harper government, predictably, screamed "the mother of all tax increases," forgetting the Greens also had suggested that the money raised from the carbon tax be offset by reductions in income and other taxes. The net tax effect would be neutral.

The Greens also recommend a cap for large industrial emitters on carbon emissions that would decline over time, and a carbon trading system under that cap. And, of course, the Greens want command-and-control regulations requiring retrofitting of buildings, phasing out of halocarbons and removal of all subsidies for coal, oil and natural gas, and compelling new coal-fired plants to sequester all carbon emissions.

This is bold stuff, and better than anything on offer from the other political parties.

Some of it, however, is too ambitious. The Greens, like the other opposition parties, are convinced that Canada can meet its Kyoto targets by 2012 without seriously damaging the economy. They are wrong.

Canada will not, cannot and should not meet its Kyoto target by 2012 of reducing emissions 6 per cent below 1990 levels when the country is already at about 35 per cent above that target.

The Greens also insist that Canada should reduce its greenhouse-gas emissions by 80 per cent by 2040. Canada doesn't need anything that dramatic. A 50-per-cent reduction by 2050 would be fine, and in keeping with what an advanced industrial country with Canada's particular challenges of economic growth, growing population, cold climate, long distances and non-renewable energy resources can reasonably accomplish.

The Greens correctly emphasize renewables (wind, biomass, solar) but exaggerate their possibilities. They dismiss nuclear energy partly because they dislike it, partly because they overestimate the capacity of renewables. Nuclear, however, is free of carbon emissions and should therefore be part of any solution to greenhouse-gas emissions, as the environmentally conscious Finns are demonstrating.

Correctly, the Greens accept the fact that, no matter what the world does, countries have to adapt to climate change. Some environmentalists have been unwilling to talk about adaptation, fearing it would divert attention from mitigation. The Greens sensibly suggest a national task force with a two-year mandate to recommend how Canadians should adapt to what a warmer climate is doing to the country.

As usual, the Greens are full of ideas for the granola set about more cycling, walking, composting, eating locally grown food, getting people to switch to public transit and lots of other ways to reduce human use of energy. Most of these ideas are impractical, or at best of marginal use, although they appeal to the hard-green voter who wants to live that kind of lifestyle.

The Greens haven't done any costing of their ideas, perhaps because no one expects them to form a government and perhaps because why bother when the existence of humanity is at stake. Melodrama is a hard-green trademark.

But the Greens did get something profoundly right: The greenhouse-gas problem can best be tackled by the use of economic policies. In an essentially free-market economy with government regulations, if you don't use prices, markets and market-sensitive regulations, not much will happen.

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