Dreams of Wardrobe

Foresight missing in Dion's Green Shift plan

Yesterday, Liberal leader Stephane Dion kicked off his party's national campaign at the University of Alberta.

His speech (which will be covered in detail here at The Nexus) was followed by a Q-and-A townhall-style meeting, in which he answered a variety of questions. Some questions -- obvious softballs -- were handled fairly effectively and predictably.

Some weren't -- including a question asked about hypothetical post-Green Shift Canada, which envoked a rather perplexing non-answer:

First, the question:

"If your Green Shift plan is implimented, and is successful, inevitably what we're going to see is a decrease in the taxable greenhouse gas emissions. What I'm wondering is what would a Liberal government do to make up that lost revenue?"

And the distinct non-answer:

"If we decrease the level of emissions, then the revenue of the tax will go down.

I pray it will happen!

And at that time, you know what? We'll have our revenues coming from the green economy we'll have created. Good taxpayers and good companies that will not exist in a small number. They'll be everywhere in the country.

I will give you an example: Denmark.

Denmark at first it suffered a shock. They were closing the country on weekends. I mean that you had to drive elsewhere on Saturday and Sunday. They decided to come to tax on fuel. And increase the tax on fuel. It was controversial. At that time they were 99% dependent on oil. Today, they have 0% dependence on oil. They have full employment, and this small country is exporting to the world a third of its windmills. If it's possible there, why not here?

I hope that the carbon tax one day will not exist because we'll have so few greenhouse gas emissions. It's not for tomorrow. Today, we are the worst among the world for greenhouse comissions.

We have a lot to do and it's not possible to do effectively if you don't put a price on greenhouse gas emissions. We come with good programs, good incentives, with education.

For a significant rsult, you put the price greehouse gas emissions and reduce the tax on your income, your investments, your savings and, if you're in business, your profit."

So essentially, one of two things can be taken away from Stephane Dion in this distinct non-answer:

Either Stephane Dion has no plan for the future -- no post-Green Shift plan to restore the inevitable lost revenue due to decreased taxable greenhouse gas emissions -- or he imagines that all this lost revenue will essentially be made up by exporting windmills. Somehow.

If Stephane Dion indeed has no post-Green Shift plan, one could at least applaud his honesty if he were to clearly and openly admit so.

But the alternative explanation, sadly, does not hold water. After all, even if Canada does experience the Green industry boom that Stephane Dion imagines, one has to remember that, under his Green shift tax plan, the profits of such companies -- and the incomes of their employees -- will be taxed at a lower level. The likelihood of such revenues making up for the lost revenue from decreased greenhouse gas emissions isn't terribly likely. It simply isn't mathematically feasible.

Considering that Dion's post-Green Shift numbers just don't seem to add up (at least not in any realistic fashion) the only real alternative seems to be a post-Green Shift tax grab -- increasing tax rates (even if only to 2006 rates) in order to recover the lost revenue.

After all, Stephane Dion is the individual who has spent the last 18 months decrying the lost revenue from the Conservative government's tax cuts.

Someone in the Liberal party needs to remind Stephane Dion that it will take more than prayer to make his Green Shift plan successful. It will take an eye to the future.

If Stephane Dion really has no post-Green Shift plan, big questions remain about whether or not Canadians can trust him to impliment it.