In January’s Climate Change Solutions: Frontline Perspectives from Around the Globe webinar, Dr. Shi-Ling Hsu, law professor at the University of British Columbia and author of the new book The Case for a Carbon Tax: Getting Past Our Hang-Ups to Effective Climate Policy, joined the Yale Center for Environmental Law & Policy to discuss climate policy from Canada's perspective. His presentation, “Climate Policy in Canada: (Snow)Boots on the Ground,” explained the nuances of Canadian policy that outsiders may miss by focusing only on the similarities between Canada and the United States.
On the surface, many of Canada’s climate actions appear to parallel those of the United States: Canada’s recent withdrawal from the Kyoto Protocol or its acceptance of the Copenhagen Accord might be seen as Canada simply following the U.S. lead in international policy, and Canada’s efforts to impose federal command-and-control policies for greenhouse gases might look similar to President Obama’s efforts to regulate carbon under the Clean Air Act. However, there are several subtle but important distinctions between the two neighbors’ attitudes toward climate policy, Hsu said.
He outlined four “puzzles” that, when explained, reveal differences between the United States and Canada:
- Why is Canada’s conservative and market-savvy federal government embracing command-and-control climate policy, rather than a market-based approach?
- Why is British Columbia—the only province in North America to have accepted a carbon tax—so far ahead of the country and the continent?
- Why are four important Canadian provinces still participating in the Western Climate Initiative, when all U.S. states except California have abandoned the program?
- What explains Alberta’s voluntary adoption of carbon policy when its economy and policies are so tightly linked with oil & gas extraction?
To explain these puzzles Hsu identified four unique Canadian qualities:
- Trade Dependence. Canada places a strong emphasis on maintaining healthy trade relationships with the U.S., Europe, and (more and more) China.
- Conciliatory Attitudes. Canadian political leaders often value consensus and conciliation over confrontation and conflict.
- Federalism. Canada is a very federalist country—the jurisdiction of Canadian provinces is much broader than that of U.S. States. Provincial responsibility for action on climate change is well recognized, and passing federal climate policies can be very challenging.
- Strong Executives. Canada’s executives (the Prime Minister and provincial Premiers) can be very powerful if backed by a legislative majority. Additionally, Canadian courts are highly deferential to executive branch action or inaction. Unlike in the U.S., if an executive agency makes a decision, Canadian courts are unlikely to question or overturn that decision.
Hsu then explained how these four Canadian qualities—unique compared to the U.S.—explain the four “puzzles” of Canadian climate policy:
- Trade Dependency and Federalism explain Canada’s command-and-control approach to carbon regulation. To avoid trade tariffs and to otherwise remain competitive in a global marketplace, Canadian companies want to show that they operate under similar regulatory conditions as other countries. Additionally, command-and-control regulation is one of the few carbon policies that the federal government is positioned to impose; the federal government does not have constitutional authority to implement a cap-and-trade program. Hsu notes, however, that the proposed means of achieving federal command-and-control may be a tough sell: the government has defined greenhouse gases as toxic substances, and thus plans to regulate emissions under criminal law.
- The Strong Executive role of British Columbia’s Premier Gordon Campbell explains why the province succeeded in passing a carbon tax. Premier Campbell was politically and intellectually interested in a carbon tax policy, and in 2008 he faced ideal political conditions to lead parliament in adopting the legislation. Interestingly, Campbell’s political party was the less liberal of the province’s two parties; by taking leadership on carbon, Premier Campbell won support from environmentalists who were traditionally more supportive of his opponents.
- Federalism explains why the provinces of British Columbia, Manitoba, Quebec, and Ontario remain in the Western Climate Initiative when all U.S. states (except California) have dropped out. Because there is no expectation of leadership from the federal government, Canadian constituencies demand and expect action from their provincial leadership; thus, participation in the Western Climate Initiative is well supported.
- Trade Dependence, Conciliatory Attitudes, and Federalism explain why the fossil fuel-dependent province of Alberta has taken voluntary (albeit tepid) action on climate. Oil and gas production accounts for 25 percent of GDP, 75 percent of exports, and 35 percent of government revenue in Alberta. This dependence on fossil fuel trading motivates Alberta to remain an attractive trade partner to countries that more and more prefer climate-friendly suppliers; Alberta’s climate policy is a sign to trading partners that the province is doing something to address climate change. Additionally, a general inclination to remain conciliatory with neighboring Canadian provinces likely motivated Alberta to pursue some degree of voluntary action. Finally, Canadian federalism means that Alberta’s voluntary action may also prove strategic: by having a climate policy in place, Alberta makes it more difficult for the federal government to impose top-down (and potentially more impactful) legislation.
To conclude, Hsu predicted climate action will continue to come from Canadian provinces, rather than from Canada’s federal government. He recognized that, despite the unique qualities of Canadian politics, action from the United States would likely motivate action from Canada. In the perhaps more likely case that the U.S. fails to pass significant climate legislation in the short term, there is still potential that Canada might show leadership by adopting a carbon tax.
Such a tax, Hsu said, could be significant even if it’s not very steep. Even a slight price on carbon could guide upcoming capital decisions (regarding the construction of new power plants, for example) toward less carbon-intensive paths.
A full recording of Dr. Hsu’s presentation, along with recordings of all the other webinars in the Climate Change Solutions series, is available at http://yaleenvirocenter.webex.com.