The Climate Change Discussion Thread

[Build.It]

Originally Posted by ssiguy

In fairness to Ontario, GHG emissions plunged worldwide in 2020 due to the lockdown during COVID which stifled manufacturing, international travel, and commuting. A slight rebound in the emissions in 2021 was to be expected as the economy bounced back and people started travelling and working again.

This is correct

[Build.It]

Originally Posted by WarrenC12

There's a few more variables than that. I'll trust the basic concept of supply and demand, and the Nobel winning carbon tax.

As others have stated, it's likely too low to push the needle too far.

Just to get our facts straight, you are talking about a guy who won the Nobel prize in 2018 for coming up with the revenue-neutral carbon tax back in 1990.

When he received the prize in 2018, the only place his model had ever been used was British Columbia from 2008 to 2012. During this stretch, almost every other Canadian province, had a bigger drop in emissions/capita than British Columbia.

And as far as I'm aware, the only other time this revenue-neutral carbon tax model has been implemented was by the Liberal Party of Canada in 2018. To my best knowledge, no other country has ever used this model. Just Canada. And we don't even know if it has worked (although there is plenty of indications that it hasn't).

This is what the remaining supporters of the revenue-neutral carbon tax are so staunchly fighting for - a system that hasn't proven to work, and isn't used by any other country.

[Build.It]

Just to break down the revenue-neutral carbon tax in very simple terms.

You punish someone for polluting by charging them a tax for it.

Then you give them that money back, thus undoing the punishment.

In the end they still have the same amount of money, and therefore there is no incentive to change any behaviour.

In fact some people end up with more money, so they can afford to pollute even more.

But during this process you are making every product made in your country more expensive.

So to in order to compete, businesses start bringing these products in from further away, which creates more pollution.

And that is why you end up with results that look like this:


https://www.conferenceboard.ca/hcp/ghg-emissions-aspx/


https://ourworldindata.org/co2-and-g...-gas-emissions

[ToxiK]

Originally Posted by Build.It

Just to break down the revenue-neutral carbon tax in very simple terms.

You punish someone for polluting by charging them a tax for it.

Then you give them that money back, thus undoing the punishment.

In the end they still have the same amount of money, and therefore there is no incentive to change any behaviour.

In fact some people end up with more money, so they can pollute in even more.

No it is not. It is a build-it-yourself tax break. There is a tax, you want to stop paying it than you have to make an effort by reducing your GHG to get it.

It is similar to wanting more money and having to make the effort to work to get that extra money.

[Build.It]

Originally Posted by ToxiK

No it is not. It is a build-it-yourself tax break. There is a tax, you want to stop paying it than you have to make an effort by reducing your GHG to get it.

It is similar to wanting more money and having to make the effort to work to get that extra money.

You. Get. The. Money. Back.

It is revenue neutral.

If you want the tax to work, then you need to stop refunding it.

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If you got a speeding ticket for $300, paid it, and then received than money back 3 months later - would it do anything to change your behaviour, versus if they didn't give you the money back? Yes, you would be more comfortable driving faster, because you know you will just get the money back.

How about if all of a sudden they increased the fine to $1000, you get caught again, paid the fine, and then got the $1000 fine back 3 months later. Would the fact that the fine was now more expensive do anything to make you drive slower? No. It doesn't matter what the fine is, since you know you're going to get it back.

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How about if you didn't get any speeding tickets that year, and the government sent you a cheque worth the "average" speeding ticket for the year, of $300. Would that change your behaviour? Yes, you would drive faster, because you know if you get caught speeding, you have some extra cash lying around to pay the fine.

[lio45]

Originally Posted by Build.It

You. Get. The. Money. Back.

It is revenue neutral.

There is no additional incentive than if the tax simply didn't exist.

ToxiK is correct: it’s revenue-neutral when averaged over everyone. That’s the incentive: if you reduce your footprint it’s revenue-positive for you, while it’s revenue-negative for polluters, averaging to neutral.

Everyone gets everyone’s pool money back, but people don’t get their own money back; some get more, others less. It’s as revenue-neutral as a winner-takes-all poker game between buddies. Five guys bring $100 each, one leaves with $500 and the four others with zero. Revenue-neutral, except that one guy quintupled his money (“the incentive to win”)

[Truenorth00]

Originally Posted by ssiguy

My issue with the carbon tax is not the tax perse but rather the idea that if it works for one part of the country it will work everywhere. Canada is not the Netherlands or even Germany. We have wildly different geographies, economies, and political leanings. Canada is a classic case of "one size doesn't fit all".

We don't have a one size fits all. The only requirement is that provinces put a price on emissions. How they do that and what they do with the revenue is up to them. The federal backstop only applies if they don't comply.

You live in BC. You should know this. You don't have the same system as Quebec. Nor do you get a rebate like the provinces applying the federal backstop.

[Truenorth00]

Originally Posted by ToxiK

No it is not. It is a build-it-yourself tax break. There is a tax, you want to stop paying it than you have to make an effort by reducing your GHG to get it.

It is similar to wanting more money and having to make the effort to work to get that extra money.

Exactly. How you net out is determined by your personal footprint relative to the provincial average. Use less than your neighbours and it's a net gain. Frugality is actually rewarded.

[Changing City]

Originally Posted by Truenorth00

We don't have a one size fits all. The only requirement is that provinces put a price on emissions. How they do that and what they do with the revenue is up to them. The federal backstop only applies if they don't comply.

You live in BC. You should know this. You don't have the same system as Quebec. Nor do you get a rebate like the provinces applying the federal backstop.

I live in BC, and I get a rebate under the BC Climate action tax credit, paid every quarter into my account. It's based on income and family structure, so a top 10% family like yours might not see anything, but us low-income types see some money. I only have electricity, no gas, and I don't buy gasoline for a vehicle, so I only contribute a very small amount of my income to carbon tax, but I get over $100 a quarter back, generously contributed by people who chose to use or buy gas to drive to distant suburbs like White Rock.

[Build.It]

My question to the city-dwellers who are net recipients of the carbon rebate cheques:.

Is it the carbon tax that motivated/encouraged you to live your current lifestyle? Or would you have lived the way you do now anyways, regardless of whether or not we had a carbon tax?

[Truenorth00]

Originally Posted by Changing City

I live in BC, and I get a rebate under the BC Climate action tax credit, paid every quarter into my account. It's based on income and family structure, so a top 10% family like yours might not see anything, but us low-income types see some money. I only have electricity, no gas, and I don't buy gasoline for a vehicle, so I only contribute a very small amount of my income to carbon tax, but I get over $100 a quarter back, generously contributed by people who chose to use or buy gas to drive to distant suburbs like White Rock.

I actually like the federal backstop. Same rebate for all means minimal administration. Everyone gets the same. And it's up to you to net out based on your lifestyle.

I personally like the aspect of rewarding a low carbon lifestyle with funds from those with carbon heavy lifestyles. This is Pysch 101. Positive reinforcement for the low emitters. Positive punishment for the high emitters. And in some ways it compensates for externalities that aren't usually recognized in the past. The folks with fewer and smaller cars, and higher transit or active transport use, are also helping reduce traffic. There's finally a reward for doing this, that goes beyond just not having to buy gas.

[Build.It]

Case study 1 - Peter

Peter's family lives in a condo, with only 1 vehicle which they rarely uses, and is a high income earner. Peter prefers to live like this since it means he can save and invest more. When the government brings in carbon tax, Peter starts making profit off it. Peter mostly uses this money to buy mutual funds, but also uses some of it to take his kids to the movies. Has Peter's behaviour been modified by the carbon tax?

Case study 2 - Jack

Jack lives in the suburbs in a detached house. This is not a cheap lifestyle, but Jack and his wife do fairly well. They 2 kids, 2 cars, a dog and a RV. This lifestyle is pretty expensive to maintain, but they can afford it. When the carbon tax kicks in they notice gas has gone up a bit, but compared to all the other expensive things in their lifestyle, it's a drop in the bucket. They then get a cheque in the mail that refunds most of the extra cost they paid on carbon tax. Does the carbon tax do anything to change Jack's behaviour?

Case study 3 - Joseph

Joseph lives in a townhouse with his family. They're definitely not rich, but they make it work. Joseph and his wife each have a small car. Their utility bills are fairly small to begin with, since they live in a townhouse. When the carbon tax kicks in, they notice their gas and heating bills go up a little bit. It's annoying but it's not gonna break the bank. Then a few months later they receive a cheque from the government that refunded this amount. This goes straight to the bank account and gets spent in the next few weeks on gas to get to work, and groceries. Has the carbon tax done anything to change Joseph's behaviour?

Case study 4 - Jeremy

Jeremy and his wife rent a small apartment. Combined they don't make very much. They can't afford a car, so they take transit, walk or bike places. When the carbon tax kicks in, Jeremy notices he starts receiving cheques all of a sudden. This is a relief, and gets used to pay off his credit card, and go to a restaurant. Has the carbon tax done anything to modify Jeremy's behaviour?

Case study 5 - Samuel

Samuel is a self-employed electrician. A lot of his job sites don't have roads yet, so he drives an F150. The F150 isn't cheap to maintain, but it makes the most sense for his business. Plus he gets to write off the vehicle expenses against his income. When the carbon tax kicks in his price at the pump went up by $20 per fill. He is mildly annoyed by it but then forgets 5 minutes later as he sips his Tim Hortons coffee. Samuel then receives a refund cheque that reimburses him for a portion of the extra cost. The rest of the difference he just charges to the customer. Has the carbon tax done anything to modify Samuel's behaviour?

[Truenorth00]

Peter, Jack, Joseph and Samuel all have vehicles. If they prioritize fuel efficiency at the moment they have to replace their vehicles, the policy will have done its job. If Jack and Joseph prioritize home efficiency upgrades over aesthetic upgrades (new heat pump over new granite), the policy will have done its job. And finally Jack subsidizing his neighbours is useful policy. They are rewarded for leading simpler and less carbon intensive lifestyles while Jack gets a reminder everyday that gas is expensive and he should find a way to cut back.

This is how economics works everyday across a range of products and services. That somebody who is supposedly an entrepreneur who actually deals in lighting (a field concerned with efficiency) doesn't understand this is mind blowing.

[Build.It]

Regarding fuel-efficiency and heat pumps.

If everyone else makes this decision, but Jack, Sam, Peter and Joseph don't, then yes they will be penalized. However if most people don't bother to change their lifestyles, since they're getting refunded for the difference, then nothing changes (which appears to have been the case so far).

[Build.It]

Jack gets refunded for most of it. There is no incentive to change. Per PBO at most he would be out $2000 a year across the board, including everything he buys. This is a fairly insignificant amount for Jack whose household makes over $200K.

[Truenorth00]

You were asking how their behaviour would change. Now you're gish galloping on to something else.

Here's a question for you. When the price of something goes up do you consume less of it? Yes or no.

And if no, is there a price point where you would change your purchasing behaviour or would you buy till infinity?

[Build.It]

It is absolutely mind blowing that people look at the program structure, and then look at the result, and then see Canada is the only country in the world with this program, and then continue to tell us that this policy is working. It is obviously not working.

If you don't refund the money, as every other country in the world runs their carbon tax, then it will actually work.

The refund is the problem.

[Build.It]

If the price goes up, but the government then refunds me for the price increase, then no. Why would I? They can make the tax $1 per litre if they want, but as long as they keep refunding me, I can still afford it. If they stopped refunding me, then I might change my behaviour.

Just use your eyes and look around you. No one has changed anything in their lives because of the tax. At most it is a mild inconvenience, but you still end up getting the money back 3 months later in a lump sum, so in the end if you change nothing, and no one around you has changed anything, then you still end up net neutral.

[Truenorth00]

We can also look across markets and see how populations behave at different fuel prices. Like how Europeans and Asians, on average, drive smaller vehicles, driven by higher fuel prices. Or how natural gas spikes in Europe lead to booms in demand for heat pumps. Turns out that consumers are quite rational in responding to prices. That Adam Smith fella might have been on to something after all.

[Truenorth00]

Originally Posted by Build.It

If the price goes up, but the government then refunds me for the price increase, then no. Why would I? They can make the tax $1 per litre if they want, but as long as they keep refunding me, I can still afford it.

Presumably because you get impacted by sticker shock. It's exactly why you're here whining every single day. You know you get reimbursed, but you will want that cut of 12¢/L.

Also, dude like you? I'm going to guess you're not netting out. Which is also why you're here whining about it. It burns you that you might have to consider less than monster truck for your next purchase.

Hilarious, how on one hand the price is too low matter. On the other hand, life in Canada is apparently entirely unaffordable because of this carbon tax.

You'll get the cancellation of the program soon enough. Really at this point, it's about how far you'll go in this thread to deny basic economic principles.