Reevely: Patrick Brown's final gift to his party is a bloodbath over carbon taxes

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All the Progressive Conservative party’s leadership candidates are skeptical of carbon taxes, seeking support from party members who hate them even more, but their party is counting on billions of dollars in carbon-tax money to pay for its election promises.

They need the cash even more than the Liberals do. That’s an awkward position for a party of tax-fighters, and one Doug Ford, Christine Elliott and Caroline Mulroney somehow have to reconcile.

Before Patrick Brown abruptly quit the Tory leadership Jan. 25 facing allegations of sexual misconduct, he’d delivered his party a “People’s Guarantee” for the provincial election in June. Whoever succeeds him will inherit it, with little time to change its dozens of promises or re-run the detailed accounting work they led to.

Brown had been elected leader without promising a carbon tax and shocked Tories when he announced he supported one at a convention in Ottawa in March 2016. In retrospect, that was a critical point for his abbreviated leadership, the moment a lot of conservative Progressive Conservatives began doubting him. But he kept with it.


Doug Ford greets supporters after speaking at his – Rally for a Stronger Ontario – regarding his bid for the Ontario PC leadership at the Toronto Congress Centre in Toronto, Ont. on Saturday February 3, 2018.


The Tories’ People’s Guarantee talks about ditching the provincial Liberals’ cap-and-trade system in favour of the broader carbon tax the federal Liberals say they’ll put on any province that doesn’t have a carbon-pricing system of its own by the end of this year. The feds will tax carbon emissions and give the proceeds to the provincial government. The People’s Guarantee calls that “opt(ing) in to the federal carbon price backstop.”

The federal tax is much, much heavier than the cap-and-trade system Ontario already has. The current system sells carbon-emitting permits in auctions. Those aren’t perfectly predictable but the Ontario government projects a take between $1.4 billion and $1.8 billion a year for the next several.

The Tory plan expects that switching to the federal carbon tax would mean $2.4 billion in extra revenue, after a couple of wobbly adjustment years.

This isn’t some gotcha calculation based on numbers from page 31 and page 187 or anything. It’s right there in a handy chart that sums up the accounting: “Net New Federal Carbon Price Revenue,” it says, with numbers that rise to $2.405 billion in 2021.

The sooner Ontario gets out of the cap-and-trade business, a footnote adds, the more money we can expect from the feds.

I’ll say that again because I know it’s hard to believe: The Progressive Conservatives expect to make about three times as much money off carbon pricing as the Liberals do.

Now, what a PC government would do with all that money is very different. The Liberals have a detailed plan to spend their cap-and-trade money on green projects, from transit to energy-efficiency retrofits to research on low-emission energy, totalling $1.9 billion a year. The Tories would scrap all that.


Christine Elliott in 2014.


Instead, they’d cut income taxes ($3.2 billion) and small-business taxes ($150 million), give parents tax credits for child care ($389 million), enhance sales-tax credits ($589 million) and give drivers tax rebates for buying winter tires ($19 million). Plus a bunch of other little boutique tax cuts and credits.

In all, they want to cut the provincial government’s tax take from everything other than carbon by nearly $4.6 billion. They also have about $2 billion in new things they want to spend money on, from subsidizing hydro bills to improving services for children with autism. Put it together and the extra money from the Trudeau carbon tax covers one-third of the Tories’ more fun promises.

The People’s Guarantee also pledges $2.8 billion in unspecified cuts — the auditor general will find waste for us and we won’t miss it, apparently. OK, maybe. Regardless, there’s already a big dollop of “we’ll figure this out later” in there.

If a new Tory government just sticks with the provincial Liberals’ cap-and-trade system instead of opting into the richer federal carbon tax, the $2.8 billion in magic cuts becomes $5.2 billion. If Premier Elliott or Mulroney or Ford finds some way out of pricing carbon altogether (let’s say Justin Trudeau and the federal Liberals lose power in 2019 and no federal backstop is ever created), the hole is $7 billion. This is real money in a $150-billion provincial budget, not a rounding error.

Watching the leadership candidates struggle with this isn’t pretty.


Caroline Mulroney speaks after being named as the Ontario PC nominee for the York-Simcoe riding in September 2017.


Ford promises to kill carbon taxes in Ontario and make up the lost money in “efficiencies.” If Justin Trudeau imposes a carbon tax, he said at his campaign-launch rally, Ford will stop it. “I’ll tell the prime minister, well, just the same way his father said it, ‘Just watch me’.”

This sounds direct but it doesn’t mean anything. If only the government ran on slogans.

Elliott and Mulroney both harrumph about carbon taxes — they’re personally opposed to them, they want to be sure you know — but want to talk about carbon pricing more before committing to anything.

“I want to speak to the caucus and the nominated candidates to understand their views of it before we go forward,” Elliott told the National Post’s Chris Selley.

“As a conservative, I don’t like taxes,” Mulroney told him, “and the carbon tax is a tax.” But, again, she wants to hear what people think.

Well, sure: All the choices are awful. The possible solutions are deeper spending cuts, cancelling promised tax cuts, raising other taxes, or deficits. Or stick with Brown’s plan. The Progressive Conservative party has to decide what it’s going to be, and it needs a leader who will tell us.

dreevely@postmedia.com
twitter.com/davidreevely

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