Will Canada buy emissions credits?

The Canadian Taxpayer Federation asks a good question.

Since 1990, the Canadian economy has grown an impressive 45%. Liberal Environment Minister Stéphane Dion has acknowledged a strong economy and job growth has worked against Kyoto. Unless Ottawa is willing to trigger a made-in-Canada recession it will fail to meet its emissions goal. If this sounds alarmist consider that greenhouse gases increase with economic growth. To roll them back means shrinking the economy or achieving negative growth. The economic term for 2 quarters of negative growth is a recession.

It is good news that no government hoping to be re-elected – today or down the road – can advocate inflicting the economic pain on Canadian workers that Kyoto requires. So how might Ottawa fulfill its obligations? One scenario is for the federal government to purchase so-called greenhouse gas credits from developing nations, like Russia and the Ukraine. Because of the collapse of Communism in 1989 – and the economies of Eastern Europe and Russia soon after – Moscow and others have a surplus of “unused” emissions to sell today.

Many economists and environmentalists regard this as purchasing “hot air” since nations that sell surplus gases need not reduce their current CO2 output levels. The result is Canada will continue to pump out emissions and claim victory while it pays foreign governments for credits. This is absurd public policy: tax dollars spent overseas with no tangible benefits to our environment, the economy or Canadian taxpayers.

With Canadians voting in January, now is an ideal time to ask whether or not our political leaders support using tax money to buy emission credits from other nations.

Since political parties prefer not to develop policy during election campaigns this should be an easy one for them. Canada ratified the Kyoto agreement in 2002, giving all leaders ample time to develop a position. Taxpayers are seeking an answer to the following question: will a (insert party leader’s name here) government spend tax dollars to purchase carbon dioxide credits from other nations to meet Canada’s Kyoto targets?