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Yesterday the Canadian Conservative government released a major study predicting that compliance with the Kyoto Protocol would bring an economic apocalypse. The Environment Canada study says the Kyoto emissions-cutting targets for Canada could be met only by introducing a massive $195-per-tonne carbon tax, which would wipe out thousands of jobs and undercut Canadians’ quality of life.

Environment Minister John Baird said every Canadian family and business would have to cut greenhouse gas emissions by one third starting in eight months. Baird told the Senate environment committee:

“There is only one way to make that happen - the government would need to manufacture a recession.”

He also said the federal government remains committed to the principles of the Kyoto treaty. Although Canada announced last week that it may want to join the Asia-Pacific Partnership on Clean Development and Climate (AP6), a six-nation coalition focusing on voluntary emission-reduction steps and technology transfers. Environmentalists oppose AP6 out of a fear that it may undermine political support for the legally binding Kyoto treaty. Unlike the Kyoto Protocol, the Asia-Pacific Partnership is voluntary and technology-based, and permits each country set its own goals for greenhouse gas emission reductions, rather than legally binding them to a greenhouse gas reduction target.

Opposition critics and environmentalists claimed the Environment Canada study is flawed because it excludes the benefits of cutting emissions, such as reduced energy costs and a more stable climate, and because it limits access by businesses to international emissions credits.

Prime Minister Stephen Harper said the real issue is whether any of the opposition parties “have the guts to face reality. The reality is this: You cannot reduce greenhouse gas emissions by one-third and have a positive effect on the Canadian economy. This party has no intention of doing anything that is going to destroy Canadian jobs or damage the health of the economy.”

The Conservatives are trying to add credence to the report by also releasing an opinion from Toronto-Dominion Bank chief economist Don Drummond that effectively backs their findings. Drummond says the magnitude of Canada’s required greenhouse-gas reductions under Kyoto is almost unparalleled. His letter dismisses Bill C-288 as unworkable, saying,

I sincerely hope no serious consideration is being given to implementing the policy.This shock would represent a huge loss to Canadian competitiveness. Exports would plunge and imports rise.

He warns that such a hefty carbon tax, designed to drive down emissions, would substantially hurt the economy even if Ottawa funnelled the revenue collected from the levy back to Canadians via personal and corporate income-tax cuts.

Dire federal forecast for Kyoto compliance meets with skepticism
Ottawa rolls out ‘validators’ to bolster anti-Kyoto stand
Canada joins anti-Kyoto bloc

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