Download Alberta Carbon Tax – Literature Review

Alberta Carbon Tax – Literature Review
By Gennadi Boitchenko
November 30, 2016
Table of Contents
Executive Summary ........................................................................................................................ 1
Introduction ..................................................................................................................................... 1
Background ..................................................................................................................................... 2
Viewpoints ...................................................................................................................................... 4
In Support of the Carbon Tax ...................................................................................................... 5
In Opposition to the Carbon Tax ................................................................................................. 6
Arguments, Evidence, and Techniques ........................................................................................... 7
Evaluating Carbon Tax Supporters ............................................................................................. 7
Evaluating Carbon Tax Adversaries ........................................................................................... 9
Conclusion .................................................................................................................................... 12
References ..................................................................................................................................... 13
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Executive Summary
Against popular belief, that change is good, not all change gets a warm welcome. Since
the earth's temperature is rising for numerous reasons, global warming has become the
unwelcome hot topic. The increase in solar radiation, agriculture, solar panels, wind turbines, as
well as burning fossil fuels and wildfires are amongst the contributing factors to global warming.
This hot topic has gotten the attention of many countries around the globe, and they have
unanimously decided to combat the issue of global warming by reducing their carbon footprint.
This unanimous collaboration has since made its way to Alberta, to which the Alberta
Government announced they would reduce greenhouse gas emissions that cause climate change
by putting a price on carbon. However, the Alberta economy is profoundly saturated in the
production of energy from fossil fuels, and the carbon tax has resulted in job losses and business
closures. Yet, some Albertans, environmentalist, businesses, economists, and the government are
still in support of the carbon tax plan. On the contrary; the majority of Albertans, businesses,
economists, and other political parties have stood against it. These heavily devised viewpoints
have been argued with persuasive evidence using different types of techniques to present their
case. However, the carbon tax proposition was tried and found wanting.
Introduction
The earth is slowly warming, which raises great concern to human civilization. There are
currently many factors that contribute to global warming. These include; solar radiation,
agriculture, solar panels, wind turbines, burning fossil fuels, as well as wildfires. Nations around
the world have taken note and agree that something must be done to reduce global emissions and
create a lesser carbon footprint. Being that Alberta’s economy is heavily reliant on producing
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energy from fossil fuels, the Government of Alberta announced that they would introduce a
carbon tax that will put a price on carbon, in an effort to reduce their carbon footprint.
This carbon tax has divided many Albertans. Some are in support of said tax, while
others are opposed to it. Arguments have been raised from the people of Alberta,
environmentalist, businesses, economists, and political parties. Yet, despite strong and
persuasive propositions on both sides, it is overwhelmingly evident that those against the carbon
tax present the stronger argument.
Background
There is vast evidence for the notion that multiple factors contribute to global warming.
Amongst them are; solar radiation, agriculture, and green initiatives such as solar panels and
wind turbines, as well as fossil fuels and wildfires. Due to the harmful effects of global warming,
“Nations around the world are taking action to reduce greenhouse gas emissions” (Leach,
Adams, Cairns, Coady, & Lambert, 2015, p. 20). This year the Government of Alberta decided to
get on board and tackle the carbon footprint in which they leave by introducing a carbon tax.
However, Alberta’s economy is heavily dependent on the oil sands, and putting a price on carbon
has and will continue to have significant ramifications on all of Albertans.
Of global warming contributing factors, solar radiation has proven to be an issue. Data
yielded by Richard Willson, a researcher affiliated with NASA's Goddard Institute for Space
Studies and Columbia University's Earth Institute provides strong evidence, saying that the
“amount of solar radiation the sun emits . . . has increased by nearly .05 percent per decade”
(“Nasa Study,” 2003) Additionally, “agriculture is a significant driver of global warming and
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causes 15% of all emissions,” while “new research reveals . . . that eating less red meat would be
a better way for people to cut carbon emissions than giving up their cars” (Carrington, 2014).
The green initiative to offset greenhouse gas emissions, such as solar panels and
windmills also produce a significant contribution to global warming.
Fabricating the panels requires caustic chemicals such as sodium hydroxide and
hydrofluoric acid, and the process uses water as well as electricity, the production of
which emits greenhouse gasses. It also creates waste. These problems could undercut
solar's ability to fight climate change and reduce environmental toxics. (Nunez, 2014)
Also, a study on wind-energy found that “CO2 emissions of wind power . . . range from 14 to 33
tonnes (15 to 36 short tons) per GWh of energy produced. Most of the CO2 emission comes from
producing the concrete for wind-turbine foundations” (“The ecological,” 2013). Furthermore, oil
and gas have been a contributing factor to global warming. “Scientists have concluded that most
of the observed warming is very likely due to the burning of coal, oil, and gas” (“Global
Warming,” n.d.). Along with forest fires, which “release about 290 million metric tons of carbon
dioxide a year” (Thompson, 2007) in the United States and Alaska alone. Another study found
that;
Over the past 60 years, forest fires have had the greatest direct impact on carbon
emissions from the boreal forests located in the higher latitudes of Canada, Alaska and
Siberia, both by the amount of carbon released as the forests burn and the emission of
carbon dioxide from the soil as the sun reaches through the empty branches and promotes
faster decomposition. (Thompson, 2007)
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Since global warming is clearly an issue, “Nations around the world are taking action to
reduce greenhouse gas emissions” (Leach, Adams, Cairns, Coady, & Lambert, 2015, p. 20) and
initiatives are being made to prolong its impact on the earth.
In December 2015, the 21st Conference of the Parties (COP) to the United Nations
Framework Convention on Climate Change (UNFCC) meetings in Paris, will aim to
achieve a legally binding and universal agreement, with the goal of keeping global
warming below 2°C. (Leach, Adams, Cairns, Coady, & Lambert, 2015, p. 20)
In light of these aspirations “Premier Rachel Notley announced a significantly more aggressive
climate change leadership plan” (Ignasiak, Carson, Oleniuk, Saric, & Barretto, 2015). To which
Alberta’s NDP party instituted a Carbon Tax, saying that “putting a price on carbon is the most
cost-effective way to reduce greenhouse gas emissions that cause climate change” (Carbon Levy
and Rebates, n.d.). Even considering the many contributing factors to global warming, Alberta’s
NDP party has decided that a carbon tax is the best solution, despite the economic consequences.
This personal impact has caused great havoc within Alberta and has resulted in very strong and
controversial viewpoints.
Viewpoints
The carbon tax has become a hot topic for Albertans because of its different viewpoints.
Arguments are being raised from Albertans, environmentalists, businesses, economists, and
governments. These arguments contemplate those in support of and those opposed to the carbon
tax. The following will portray these two main controversial viewpoints.
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In Support of the Carbon Tax
Albertans care deeply about the environment and understand that it is everyone’s
responsibility to take care of the environment, both now and in the long-term. One survey done
by Simon Dyer of the Pembina Institute revealed that of the 1,844 Albertans surveyed, more than
70 percent “support investment in renewable energy to reduce reliance on coal”, while even
more said that “Alberta ‘should do more’ to invest in and support development of clean energy
and clean technology” (Pratt, 2015).
The environmentalist community says that this policy option will “help the province
reduce greenhouse gas emissions and take action on” (Leach, Adams, Cairns, Coady, & Lambert,
2015, p. 2).
Additionally, many economists are in support of a carbon tax, calling it a “big win,” and
suggesting “it is a far more efficient means of lowering greenhouse gas emissions than regulatory
approaches. As well, “the consensus among top economists on this point is as strong as the
consensus among scientists that climate change is real and greenhouse gas emissions contribute
to it” (Tombe, 2015).
Along with individuals, environmentalists, and economists, some businesses are
supporters as well. Suncor didn’t seem to be opposed when their very own Gordon Lambert said:
“We think a price should be put on carbon.” (Dembicki, 2012)
Furthermore, Alberta's NDP government was pleased to announce that a carbon tax is
coming to Alberta, saying “pricing carbon is one of the most sensible policy prescriptions to
address greenhouse gas emissions, so this is good news” (Tombe, 2015).
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In Opposition to the Carbon Tax
It is overwhelmingly evident that the majority of Albertans are against the carbon tax,
and for good reason. Alberta is in an economic downturn and adding a tax at this time will only
add to the suffering. Multiple rallies and protests have been held, while petitions have been
signed, and Albertans are not happy. The carbon tax “is expected to increase the cost of gas and
energy” and “would only kick Alberta when it's already down” (Romero, 2016).
The environmental argument suggests that “no matter how successful Alberta is at carbon
reduction, [they] won’t affect global greenhouse gas emissions. If all Canada follows these
policies, Canada will drop from 1.6% of the world total to 1%” (Hicks, 2016).
As well, economically, the carbon tax does not seem to be the best plan. “The current
solution is to make fossil fuels so expensive nobody will want them.” The problem, however, is
that “it's not only economically inefficient but it's also politically impossible. What we should do
instead is invest dramatically more in research and development” (Lomborg, 2011).
Furthermore, businesses in Alberta will be heavily affected by the carbon tax, and
therefore most businesses are not in support of it.
Alberta’s entrepreneurs believe there will be major negative impacts on their business
when the carbon tax takes effect. Eighty-six per cent said it would increase their
operating/input costs, 85 per cent stated it would reduce their profitability, 66 per cent
believed it would increase pressure to freeze/cut salaries, while 59 per cent said it would
cause them to delay investments inside their business (e.g. employees, equipment). (“AB
small,” 2016)
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Other political parties in Alberta, including the Wildrose, are opposed to the carbon tax as
well and have said;
The NDP did not campaign on this tax, and now it’s hitting families at a time they can
least afford it. During a time of economic turmoil and massive job losses, the NDP's new
plan will only make things worse. (“Call for Referendum,” n.d.)
This tax will affect every family in Alberta by increasing the cost of heating, fuel, power, and
almost all goods and services produced in Alberta. “The tax is not revenue neutral, meaning it
simply makes the average Albertan poorer” (“Call for Referendum,” n.d.).
Remarkably, those in support of the carbon tax and those opposed to it have strong
viewpoints and portray convincing propositions. Yet they are exceptionally opposite, and even
contradicting of one another.
Arguments, Evidence, and Techniques
Although the contradicting viewpoints have seemingly supportive evidence, they both
use different arguments and techniques to persuade readers.
Evaluating Carbon Tax Supporters
The poll commissioned by the Pembina Institute said that 70 percent of Albertans support
the renewable energy initiative. However, “a good writer manipulates connotation in order to
manage the perceptions of the audience” (Lewis, 2008, p. 37). This is very clear in the way the
survey results are portrayed. 70 percent of 1,855 Albertans is only 1,299 people. In other words,
only 1,299 people out of 4,252,879 (Population, 2016) were considered for this survey. That is
actually only a mere 0.031%, instead of the 70% portrayed in the article. The writer manipulated
the results so well, that most people would overlook the fact that support did not even break 1%.
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The writer made “gross, misleading, and exaggerated implications, knowing that the reader or
viewer will infer a meaning that they don’t have to satisfy” (Lewis, 2008, p. 39). Furthermore,
the article made a logical fallacy, “an argument that’s formally sound, yet leads to incorrect
deductions” (Lewis, 2008, p. 338). The survey shows that Albertans support renewable energy
initiatives, but did not show that Albertans actually want a carbon tax. Yet it was concluded that
a Carbon tax is exactly what they want since “some topics are hard to argue because of their
intangible nature” (Lewis, 2008, p. 332).
Similarly, the article featuring top economists has planted information which “even if
true, such lead-in facts are manipulative, selective, and incomplete. They unfairly bias the
reader” (Lewis, 2008, p. 194). This is seen when the article implies that top economists fully
support the carbon tax. Still, the economist made sure that the readers would be cognizant of its
complexity when it used statements like; “implementation of such a tax could create many new
distortions and loopholes,” “The likely outcome, though the answer depends on relevant
elasticities,” and “this policy is not sufficient. But it's a step forward” (Carbon Taxes II, 2012).
Clearly, this article has a false premise “an argument that begins with a doubtful statement
produces tainted results” (Lewis, 2008, p. 338). Furthermore, it shows its bias by excluding
alternative arguments and making no references to arguments against the carbon tax.
Likewise, the article featuring Suncor’s Gordon Lambert attempts to “appeal to good
character” (Lewis, 2008, p. 339). The available evidence seems to suggest that Suncor may have
had a shrewd long-term strategic vision. Only three years after Lambert said a price should be
put on carbon, “Suncor Energy Inc launche[d] unsolicited offer to buy Canadian Oil Sands Ltd”
(Krugel, 2015). On these grounds, it is argued that the article made a hasty generalization since
the “conclusion is based upon insufficient evidence” (Lewis, 2008, p. 336).
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The environmentalist argument faces false dilemma by presenting “only two sides in a
debate, even though many other perspectives exist” (Lewis, 2008, p. 341). They suggest they are
making great progress. Yet, even if humans stop producing carbon emissions, global warming
will still continue from other causes.
Moreover, the Macleans article that recommended putting a price on carbon because it is
a sensible solution to addressing greenhouse gas emissions (Tombe, 2015), uses an oversimplification; “a question [that] misleads when it offers only two choices to complex situations,
particularly when one answer is clearly more attractive than the other” (Lewis, 2008, p. 193). It
also “forgets” to mention that the “carbon levy will be included in the price of all fuels that emit
greenhouse gasses when combusted. These include transportation and heating fuels” (Carbon
Levy and Rebates, n.d.), among others. It also fails to mention that there will be huge economic
implications and “everyday life will get more expensive because of this tax” (Yao, n.d.).
Evaluating Carbon Tax Adversaries
Albertans evidently do not want a carbon tax. CTV News Edmonton reported on this
topic mentioning that many Albertans are protesting the carbon tax at rallies across the province.
This article used a descriptive image to support crowds of people as objected evidence. “The
most compelling proof in this regard is physical proof seen and shared by all” (Lewis, 2008, p.
332), which no one can dispute. It also uses a personification when it says adding a carbon tax
will “kick Alberta when it's already down” (Romero, 2016). “Good writers use figurative
language like personification to give their writing life and to connect with their audiences”
(Personification, n.d.). This kind of imagery also evokes emotional appeals (Lewis, 2008, p. 344)
through belonging needs; “our oil, our natural resources belong to us.” As well as security needs
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when referring to a worsening economy; “we blame them for the subsequent policy changes that
made our economy worse” (Romero, 2016).
While the environmental argument uses inductive reasoning by “reaching conclusions
based on observations of the physical world” (Lewis, 2008, p. 336). They state that reducing the
carbon footprint in Alberta will hardly make any impact on preventing global warming.
Economically, it was argued that research and development are a better viable solution to
reducing global emissions than a carbon tax. In this article, the reader will very quickly ask: “cui
bono,” who wins and who loses? (Lewis, 2008, p. 190). Though it is clear that the bias is to get
rid of fossil fuel and move completely to “clean energy,” research and development present a
strong argument for working toward solving the global issue. As well, evidence has revealed that
implementing a carbon tax has a significant impact on industries, and may lead to many of them
closing completely. Unfortunately, when entire industries are eradicated, there are enormous
economic downfalls. This is precisely what occurred in Detroit when their main industry had a
massive decline. Detroit Free Press writer Stephen Henderson stated, "The loss of tax revenue
means less money for schools, police and fire protection, and all other municipal services that
sustain a city and make it inhabitable” (Bates, 2011). However, keeping the industry and putting
money toward research and development instead, would be far more beneficial and would even
begin to solve the global warming issue. “Without the research and development that went into
space missions, top companies like Intel Corp. may not have been founded, and the population
likely wouldn't be spending a big chunk of work and free time using laptops and Blackberries…”
(Gaudin, 2009).
Likewise, most businesses are opposed to the carbon tax. The survey shown by The
Canadian Federation of Independent Business may be subject to interpretation, but the evidence
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is overwhelming that businesses in Alberta will suffer from the carbon tax immensely. In one
Alberta city, results show that “In 2016 so far, 4,114 businesses have closed, according to data
provided by the city. If the trend continues, more than 7,000 businesses will have shut down by
the end of the year” (Rieger, 2016)
Finally, political parties such as the Alberta Wildrose said that the NDP did not campaign
on the carbon tax and that it will have great consequences on Albertans. This statement offers
strong objective evidence and gives a good argument since it is undeniable and can be easily
verified and tested (Lewis, 2008, p. 332) for the quality of proof. As well it offers indisputable
evidence to the consequences of putting a price on carbon. Interestingly in November, of 2016
the Ontario Liberal Party recognized the disaster they caused by putting too much emphasis on
green initiatives. “The Progressive Conservatives say electricity rates were driven up much
higher than necessary by the Liberals’ overly-generous, long-term contracts for wind and solar
power, [while] the Liberals say rates increased because Ontario stopped burning coal to generate
electricity . . .” Premier Kathleen Wynne finally recognized the high electricity prices were “her
mistake” (Jones, 2016).
Overall, the two viewpoints and their attributes are quite opposite; the first viewpoint of
why people are in support of the carbon tax is rather weak and lacking support. While the second
viewpoint of why many are against the carbon tax is found to be more accurately representing of
Albertans and their stand on the carbon tax. The arguments and evidence are overwhelmingly
opposed to the carbon tax.
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Conclusion
Considering all contributing factors to global warming, the NDP party of Alberta has
concluded that implementing a carbon tax is the greatest desired solution. With a carbon tax on
the horizon, many companies are taking their business elsewhere, leaving Albertan’s
unemployed, and ultimately bringing an economic disaster. Despite having both viewpoints
argue using different techniques, it is unmistakable that the evidence is very weak for those in
support of a carbon tax. On the contrary, the arguments and evidence against the tax are
overwhelmingly strong.
It has been shown over and over again that implementing such a tax will not only harm
individuals, the environment, businesses, and the economy, but it has been a proven failure in the
past. The better-proposed solution, which has proven effective in other areas, would be to put
money into research and development. This would contribute to finding a solution to global
warming while supporting the local economy simultaneously.
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