Political events while I was away

Quebec Election

Defying the polls, the CAQ won a much stronger majority than many thought.  I was not surprised they won a majority due to vote efficiency, but was a bit surprised at the size.  Nonetheless it appears PLQ’s poor performance vote wise was largely due to a large drop in Anglophone turnout, probably due to their not being a threat of another referendum.  While I don’t believe Couillard deserved the humiliating defeat he suffered, this seemed more like a desire for change of players not change of direction since on most economic policies, CAQ and PLQ are not too far apart.  In both the New Brunswick and Quebec election, the common thread seems to be fatigue with traditional parties and willingness to experiment with other ones.  How this will turn out, hard to say but this should be warning to parties coast to coast people are less predictable and past success is no guarantee of future.

Based on this year’s election results, some suggest this means Trudeau is in trouble as at least 2 of the 3 and possibly all three resulted in small c conservative governments while in the two largest provinces, the Liberals suffered their worst defeat ever.  Certainly this is a warning hopefully to be careful and not get too arrogant in assuming 2019 is in the bag.  But at the same time, Canadians have a long history of going one way federally and another provincially.  Indeed, having most provinces governed by governments on the political right might even work to Trudeau’s advantage since for centrist voters you will have the balance that we lacked before; otherwise instead of left wing governments at both levels, left wing at one level, right wing at another thus a centrist balance overall.

New NAFTA deal

On balance I believe this is the best we could have realistically achieved and so relieved we managed to sign this.  It is far from perfect, but with how unpredictable Trump is, I don’t think we could have gotten a better deal.  Yes it could be much better, but that will have to wait until Trump is no longer in the White House.  So I would urge swift passage of this and perhaps in the future we can make changes with a future administration.  It gives Trump sort of a win without causing too much harm and for him a political win even if little changes was probably the best we could achieve.

Manitoba scraps Carbon Tax plans

I believe this is unfortunate, but not surprised.  When Brian Pallister came to power, most provinces were governed by centre-left parties and conservatism was in a bit of a crisis so he probably figured it wasn’t worth fighting over.  Now with multiple other provinces swinging rightward, I am guessing much of his base was becoming restless and if he didn’t make the reversal, he risked a party revolt.  Still I believe a carbon tax is the right thing and a strong leader would stare down their right wing base.  Doug Ford’s comments that the Carbon tax is the worst tax is ever is pure bunk.  Maybe in 2008 when BC first proposed one, it was possible to make this claim as BC was entering unchartered waters.  But the results are in and they showed BC’s emissions went down while the economy every year has outpaced the national average in growth (might not do as well now with NDP in government, but did so under BC Liberals).  So a smart politician looks at the evidence not ideology.  And when the evidence goes against one’s ideology, I believe they should follow the evidence not their ideology.  Only when evidence is inconclusive should one follow their ideology or use their best guess.  As such I believe a revenue neutral carbon tax is the way to go and Conservatives should get their heads out of the sand and not be bogged down by ideology.  A carbon tax as Michael Chong pointed out is actually a conservative idea as it puts a price on carbon and lets the market decide from there while it means less red tape and bureaucracy to achieve the same goals.  As such I believe Trudeau should stick to his guns here and I think the Tories should consider adopting one similar to Chong’s proposal and the one the BC Liberals had.  There are a number of benefits for the carbon tax:

  1.  It lowers emissions and with the harm climate change is causing, this is quite urgent.  Claiming Canada only emits 1.6% is a cop out.  We are a nation that when there is a challenge we step up to the plate.  That is what we did in both world wars where we punched above our weight and that is what we need to do here.
  2. It provides governments with the revenue to lower taxes elsewhere without running deficits.  When the BC Liberals left office last year, BC had lowest corporate tax rate, lowest rate for middle and low income earners, while second lowest for high income earners.  This is what made BC an attractive place to do business and why the high tech sector is booming.  We need taxes to provide the services we want, so it should be about reducing taxes harmful to growth while raising ones that are less harmful to growth and a carbon tax is less damaging to growth than higher income or corporate are.
  3. It allows the free market to do its job.  Pollution is a negative externality so all a carbon tax is, is putting a price on this externality.  Second year economics at university teaches you that for positive externalities you subsidize them while negative you tax them and this does that.

Now I understand the concern it is a regressive tax and hurts lower income individuals more and that is a fair concern, but this can be adjusted by large rebates as both Alberta and BC do for low income individuals.  In fact scrapping the carbon tax in both provinces would make more low income individuals worse off than better off.  On this issue and others I would like to see Tories return to their Progressive Conservative roots which is based on pragmatism as opposed Reform Party roots which is based on ideological dogmatism.

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