Via The Edmonton Journal:
[C.D. Howe Institute president Bill Robson] described Liberal opposition leader Stephane Dion’s carbon tax scheme, to prompt cuts in consumption by raising costs of all fossil fuel uses, as an essential dose of strong economic medicine.
“The inspiration really is environmental,” Robson said.
“If you seriously want to reduce greenhouse gas emissions the consumer has to feel pain,” the economist said.
“They’ll suffer,” he added.
The Liberals’ prediction that their carbon tax, offset by rebates through other federal programs, would end up costing typical households $240 a year understates its likely effects by a wide margin, Robson said.
The program’s projected total annual cost of $15.3 billion works out to as much as $640 per family, he estimated.
An improved “green shift” of the tax system would allow for unforeseeable changes in the natural environment, Robson added. The new system’s effective price penalty for carbon emissions should work like an insurance premium by reflecting their effects as they develop, he suggested.
The tax level could directly reflect climate change blamed on rising carbon-dioxide levels in the atmosphere by linking the levy to temperature trends, Robson said.
“It should be flexible over time as we learn more about the problems we’re trying to address.”
That includes allowing for mistakes in climate change forecasts that have hardened into “quite dogmatic” popular beliefs, he added.
“The world as I read the thermometers has been getting colder over the past couple of years. This is an area that’s enormously difficult to navigate,” Robson said.
Dion is liable to pay a high political price for candidly disclosing a complex proposal, Robson added.
“The Liberals deserve a fate better than they’re likely to experience for just having put this out there,” he said. “I fear they’ll suffer.
“I fear part of the lesson will be don’t be as forthcoming with plans.”
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