On Mindfulness, Change and Revenue Neutrality: Lessons the Alberta Party could learn from my Mother

When I was young my mother taught me an important lesson: not all change is equal. For change is merely upsetting what is. If the existing situation is okay, a change could mean one of two things: one is going in the right or wrong direction. If a change is an improvement, all is good. However, if one is looking for any change, more often than not, one will go in the wrong direction. If one chooses the wrong path, the wrong change, one will find that change will be double the work. For one will have to correct the mistake, likely find a new equilibrium and proceed to a new point. Ironically, that new point could be the old solution. So while we should seek change, we should take time to ensure that the change is one that we want. This is a lesson that my mom taught me and I have learned, through my professional and political life, that it is good advice.

However, my political compass doesn’t end with my mother. For, my father – a partisan Liberal – also taught me an important lesson: no political party is perfect and no political party has all the answers. For example, Federal Conservative Michael Chong came out with an interesting proposal for Parliamentary Reform. Called the Reform Act 2015, the proposal was a valuable and good one. Mr. Chong, as is the Conservative Way, took a workable policy answer from our past and updated it. The Reform Act called for the giving back of power to MPs by legislatively empowering Parliamentary Caucuses. Or put differently, in the 19th Century, it was tradition that MPs represent their constituencies. Problematically though, in recent times, all political parties have warped that tradition. Now, Members of Parliament tend to represent the embedded Interests of Political Parties. Consequently, by empowering Caucuses, Michael Chong was just looking to bring us back to new and effective Parliamentary balance.

While, the Bill passed, the first MPs to encounter the bill – the 42nd Parliament – decided to not fully implement it. Thus, the Liberals, the NDP and the Conservatives passed on some provisions in the bill. Despite the disappointing end of the story, one can clearly see that Michael Chong’s proposal was a masterful stroke of intelligent Public Policy, Law and Parliament History. It is a proposal that I can laud even though it comes from the opposite side of the aisle.

I started off this piece talking about my mother and my father because it is essential to understanding why I read the Alberta Party’s “Caucus Climate Change Plan. For, as a political geek, I get interested in having a conversation with people from all parties about effective public policy ideas. With that being said, I also have my parents’ critical point of view: will this policy provide “good” change regardless of the source of the idea. Consequently, when I heard that Greg Clark was announcing The Alberta Party’s “Caucus Climate Change Plan”, I got a little excited. I read the Press Release and, as usual, I found it to be underwhelming. For, as it is to be expected, Press Releases from a Political Party are full of platitudes and posturing. But one phrase did look interesting: “revenue-neutral consumer carbon tax”.

So, I went to the Alberta Party website and downloaded the Alberta Party’s “Caucus Climate Change Plan”. Given that the Alberta Party is trying to be the “leading moderate progressive party” in Alberta, I thought that the document would be a substantial conversation about Alberta’s future. Sadly, I was mistaken. As someone who studied political science and economic at York University, I expected that I would geek out on new ideas and examples from Canada or the rest of the world. Sadly, I was misguided. Nowhere in the document did we find any answers.

In the document, for example, the Alberta Party says that they are going to “Offset carbon tax revenue with reductions in personal and corporate taxes” and “support consumer-based renewables projects like rooftop solar”. The problem with that notion is simple: whose taxes are going to be lowered? Or put in other words, the Alberta Party has not defined what carbon sources they wish to be taxed, nor have they defined which personal or corporate taxes will be reduced. With such an ill-conceived proposal, one could easily see a situation where, in Alberta, such a plan could transfer money from the rich to the poor.

Don’t believe, let’s just think about it. The premise behind a carbon tax is simple; people will switch their behaviour to conserve money. The hope, for the most part, comes from a belief that the majority of people will change their behaviour in a deserved manner. In this case, a carbon tax would push people to buy smaller or more fuel efficient cars and homes. People might switch from heating their houses with oil to heating their house with natural gas. Some people might do repairs to their homes including upgrading their windows, while others might move to rooftop solar panels. However, all of those changes are predicated on simple principle: people have the capital to make that change.

In Toronto, as an example, there is a strong public transit component. Consequently, if gas taxes increase or a carbon tax was implemented, one has the capital to buy tokens or tickets for the local bus service: the Toronto Transit Commission (TTC). The TTC provides 24 hour service for the city of Toronto. Its overnight service called the Blue Night Network runs buses and streetcars from about 1:30 a.m. to 5 a.m. Service is provided every 30 minutes or better. While Subways, normal bus and streetcar service runs from 6 a.m. until 1:30 a.m (Sundays, 9 a.m. to 1:30 a.m.). Given that I have some experience in the city, I can say that I have always been able to get around the entire city of Toronto by transit in less than an hour. With four subway lines and buses that have bicycle carriers, I found that one could easily get around the city of Toronto without a car.

The same cannot be said for Calgary or Edmonton. As I have been told by many Albertans, Calgary and Edmonton are designed for cars. Consequently, it is not a surprise that as of March 31, 2010, there were 852,000 cars in Calgary. That jumped to 972,193 by March 31, 2014 and would likely have hit 1,000,000 by December of that same year.  (Car Crazy Calgary — city on track for its 1-millionth registered vehicle, according to provincial stats, By Michael Platt, Calgary Sun, Oct 29, 2014) While, Calgary has had an huge growth increase, one would still say that those number are unusual. Especially since, else were in North America that car use is actually decreasing (Car use declining in North America, By Michael McCullough, Published by Canadian Business, Aug 7, 2012).

Without a strong transit system, many residents of Calgary cannot shift their carbon behaviour. For, if one cannot buy an electric car, one cannot shift their carbon habits. While, if one can own an electric car, one might not be able to afford the higher prices that come with renewable power or buy a roof full of solar panels and the accompanying electrical storage system. Accordingly without a GST, shifting to a carbon tax is essentially a tax break for those who can afford the shift.

Given that the Alberta Party doesn’t have projected numbers, let us come up with some. At present, the NDP government has indicated that if one makes $125,000 of taxable income a 10% income tax is charged. If the Alberta Party had stated that that number should be 5%, then $6,250 less in taxes would be collected. $6,250 per year is about $520.83 a month. Given that the electric Nissan Leaf is between $32,000 to $40,000, one can see that the $520.83 per month savings would provide enough money for someone who has a $125,000 income to switch their lifestyle. Accordingly, that person would significantly reduce their chances of paying a carbon tax.

However, if one makes between 40,000 and $60,000, one would only save between $2,000 to $3,000 dollars ($166.67- $250 per month). That amount would not nearly be enough to pay for a new Nissan Leaf; and even worse, those same people would be asked to pay a new carbon tax. Consequently, with reductions in income taxes and the creation of Carbon Tax, the Alberta Party is proposing a radical redistribution of wealth. Because, their plan doesn’t provide any balance – by either adding a provincial sales tax or adding transit in the five major cities or creating any intercity rail system – the Alberta Party creates a plan that has much rhetoric and buzz words but that would hurt the most vulnerable in society.

As I have noted earlier, this province does need to take on Climate Change. However, unlike the buzzwords provided by the Alberta Party, Alberta needs to do so in a rational and balanced way. The only way this can happen is to have structural change.

The first part of the change comes in densifying Calgary, Edmonton, Lethbridge, Red Deer and Medicine Hat, so that they can be served more broadly with intra-city and intercity public transit systems. In Calgary and Edmonton, this would mean bolstering the move to transit oriented development. Or put differently, new housing would emerge around transportation hubs like C-Train and LRT stations. However, one cannot stop there. Cities like Calgary must not be allowed to spread through annexation and poor planning; but equally so, the Province must grant some independence through negotiated City Charters.

The second part of the change comes in Government Research to make the changes we need. If one uses the markers set by the Alberta Party (i.e. Renewable Portfolio Standard which requires 20% of Alberta’s generation to come from renewable sources by 2020, 25% by 2025 and 30% by 2030), one can see that the Alberta Party has failed to consider the billions of dollars necessary to make such a change. The Dutch and the Danes have equally ambitious moves and their governments have been putting millions, in not billions of dollars, of dollars annual to this goal. To accomplish their goal, the Dutch and the Danes have suggested turning their national fossil fuel based car fleet into an electric car fleet. The result would be simple: each car could turn into a “battery” when it is not in use. Or put differently, 70 to 90% of the average cars’ life is spent in a parking lot or a drive way. Consequently, while each car is parked, it could store a fraction of societies’ electrical needs. Alternatively, when power is low, those same power cells’ could power society. This symbiotic relationship though requires a grid and other technology that has not been developed. To move to the proposed standard requires investment that the Alberta Party is not willing to make.

Or put differently, the vast majority of Albertans don’t have a choice in how they can consume Carbon. Given our high home ownership rates in Alberta, we have existing private and public infrastructure which we need to convert. While, the Government of Alberta can mandate that new homes have solar roofs, electric car outlets or home electrical systems which can take home batteries, these changes would do little to change our present state of unpreparedness. Unless Government intervenes in the market to provide solar roofs, buy electric cars or transform homes electrical system so that they can use the Tesla PowerWall, we have to accept that most do not have the capital to upgrade their lives to deal with a Carbon Tax/Carbon Price future.

Before anyone mentions Europe, BC, Ontario and/or Quebec, let it be acknowledge that they have National and Regional Sales Taxes as well as High Income taxes. Consequently, adding a Carbon Tax into the mix is not a problem. Given Alberta doesn’t have that type of tax system and doesn’t have the appetite to create one; any solution provided by the Alberta Party should take that into account. Instead of creating a very big tax loophole for the rich, our solutions should be infrastructure based. Just think about it. Since Alberta uses coal and has a private electrical system, we will not be able to just ban coal power as Ontario did. Consequently, for some time to come Alberta “electric cars generate more carbon over their lifetimes than gas-powered cars” (Electric cars could boost CO2 emissions in some provinces, by CBC News, Last Updated: Mar 24, 2015 5:10 PM ET).

Therefore, the solution for all is simple: build. Build trains that run from Fort McMurray to Lethbridge. Extend the existing LRT lines in Edmonton and Calgary and build more. Envisage low density communities in this province and make them higher density. This could be accomplished by not expanding existing road surfaces, adding more public transit and not allowing cities to annex their neighbours.  If we are going to be fair to each other, we all need to change together. Therefore, some serious structural changes are needed, before Alberta can more down the road of a consumer/ consumption based carbon tax and the Alberta Party should know that.


Be the first to comment

Please check your e-mail for a link to activate your account.