Are progressives persuadable?

Given the wide range, inordinate expense and messianic zeal of the federal government's climate-change policies, some Canadians might be tempted to search for some reasonable economic justification behind the policies. Such an investigation is destined to result in failure. Instead, anyone looking to understand the left's climate policies should read Understanding the Left, an essay written earlier this year by economist John Cochrane.

According to Cochrane, free-marketers are wasting their breath debating economics with the Left. “Nobody's listening. We're making a big mistake: We are presuming a common goal to produce a free and prosperous society, full of opportunity for everyone, and somehow (the Left) missed obvious lessons of history and logic. Let's not be so patronizing.” The Left isn't trying to increase freedom and prosperity, Cochrane wrote, but rather — as we can infer from their policies — power for those who control the government. The grab for power and dearth of economic reasoning is widespread in progressive policy agendas, but most evident in climate policy.

When asked recently about increasing the carbon tax, Canada's Environment and Climate Change Minister Jonathan Wilkinson said that a “price on pollution is the most efficient way to reduce greenhouse gas emissions.” The appropriate tax rate, which depends on how environmentally harmful emissions are, might be $20 per tonne, or $50, or entirely possibly, $0 (meaning the net harm of increasing emissions is negligible). Whatever the number, most economists agree that if we are to cut emissions, a carbon tax is the least expensive way to do it, since after the tax rate is set it leaves to the market decisions as to how to reduce emissions, and by how much.

Yet in the same breath in which he said that a carbon tax is the most economical policy, Wilkinson declared that the government would look to uneconomic measures, too. “Everything is on the table,” he said, not just taxes, but also sundry regulations and government “investments.” There are economic transformations that “we know that we want to do, that the price on pollution over a long period of time might incent people to do, but it would take much longer … So, we are using a number of different policy levers.”

But if a carbon tax isn't getting people to move fast enough, it's either because: 1) The environmental cost of emissions is much higher than the current tax rate, so the carbon tax should be increased and offset by income tax cuts to mitigate the economic damage, or because 2) People would rather pay the tax than reduce emissions, so we should just accept the global warming, since its costs are lower than the costs of reducing emissions. In neither case is economic transformation via “a number of different policy levers” justified.

Indeed, the only way to discover which economic transformations are desirable is through market competition, which rewards efficient uses of resources with profits and punishes inefficiency with losses. The government has no way of knowing in advance how resources should be used or which economic processes should be changed. The federal Liberals are nevertheless pulling all the policy levers, from confiscating plastic bags and straws to increasing environmental spending and subsidies by billions of dollars.

Such policies are not justified by economics, but appeal to progressives looking to expand government control. That includes, of course, the prime minister, who in 2013 expressed admiration for China's basic dictatorship since it could more quickly reorganize the economy towards a more solar-powered model. Apparently we can throw, not only economics, but also democratic politics out the window.

As Wilkinson argued, these are “science issues. They're not political issues.” That the world must get to net-zero emissions within a few decades is something that “we actually know.” Which is presumably why the government has given itself the prerogative to regulate and reorganize industries, including phasing some out and expropriating huge sums of money to subsidize others.

The fervour with which climate change policy is advanced, Cochrane explained, takes the Left's “apocalyptic language to a far more logical conclusion. If indeed civilization is going to end in 11 years, we can't sit around and wait for democracy to wake up.” Wilkinson says that to get to net zero emissions by 2050, we “need to make substantive progress” by 2030, so in fact we might be doomed in 10 years, not 11, if we sit idly by and let emissions rise.

Whatever the timeline, apparently there is just no time to consider economics. Any search, then, for an economic justification of federal climate policies will come up empty. On the other hand, a search for climate policies that expand government control of the economy will yield abundant results.

APPARENTLY THERE

IS JUST NO TIME TO CONSIDER ECONOMICS.