The third newsworthy climate change event of last month (in addition to the Pope’s address to Congress and President Xi Jinping’s announcement that China would institute a cap-and-trade program) was an address by Alberta Premier Rachel Notley to the Montreal Chamber of Commerce. In the address, in which Notley clearly balked at toeing the federal party line on climate change, she said of Thomas Mulcair’s call for a national cap-and-trade system: “A national cap-and-trade program may not be our best road forward.” Canadians are polite; that was a Canadian version of a blunt rejection. Give ’em hell, Rachel!
I may turn out to be a fool, but I find myself wondering what options Alberta has, other than a British Columbia-style, old fashioned carbon tax. Former Canadian oil executive Dennis McConaghy wrote a month ago that Canadian oil producers should embrace a carbon tax. Privately, Alberta oil executives have long been open to this. The late Rick Hyndman, the widely respected senior economist for the Canadian Association of Petroleum Producers, espoused a carbon tax. Rick even quietly worked for Liberal Prime Minister Paul Martin, designing a convoluted (and ultimately ill-fated) cap-and-trade scheme with a price floor and a price ceiling. Hmm, a cap-and-trade with a price floor and a price ceiling … is that a carbon tax? Rick only smiled when I asked him that question.
We know that a carbon tax would win political points from economists. We know from the British Columbia experience that a carbon tax would win political points from environmentalists. If the Alberta oil industry is aboard (it is), who’s left? It’s ironic that people have always thought a carbon tax was a political non-starter. In Alberta, it really seems as though there is no place left to go.