Archive for September, 2012

When a tax is not a tax, Mr Harper

Sunday, September 23rd, 2012

Canada’s government is wrong about carbon pricing – Felix von Geyer

Where politics is about power and interests and who controls the agenda and message in their own image, ideology and self-interest, issues are usually presented as essentially contested concepts that cannot be transcended – the art of the impossible is in fact to do precisely that, transcend them.

So, when a spokesman for Canada’s Conservative government, Fred Delorey accused Canada’s official opposition, the New Democrats, of wanting to impose a carbon price, the biggest thing on show was in fact Prime Minister Stephen Harper’s highly efficient spin machine.

How much longer a government can live on spin and courtesy of a divided majority opposition is a different question to answer. Crucially, the message given this week by the Conservative Party’s strategist and spokesman, Fred Delorey that any price on carbon is a carbon tax is, in short, designed to mislead. In the language of playwright Tennessee Williams, it’s downright mendacity.

Quite simply, the government is wrong. Selling 100,000 carbon credits on the market at, for example, $15/tonne is not a tax. It is an incentive to reduce greenhouse gas emissions at less than $15/tonne.

Back in 2007, former US President Bill Clinton told New Orator that carbon taxes are great because no-one can avoid them: but cap and trade is better as it energizes entrepreneurs.

Some weeks later after he made a speech advocating a carbon tax over cap and trade, Mayor Michael Bloomberg told New Orator a carbon tax would also energize entrepreneurs.

The IMF’s 2008 WEO stated a carbon market is better than a carbon tax if you want a global price for carbon as having the best part of 200 governments agree a carbon price is nigh impossible.

Harper’s press secretary Andrew MacDougall did not respond to New Orator’s comments and questions concerning Delorey’s and the government’s myopic perspective on carbon pricing.

However, Canada’s resource-based sister economy Australia has recently introduced a carbon reduction scheme that at $15 per tonne expects to triple tax-free personal income tax thresholds to AUD$18,000 per year. In Canada, you could almost have free university education for that – and very topical it would be in Quebec as well as allowing more funds to be channeled into education, R&D, environmental science and technology.

According to the government’s own statistics for 2009, GDP was C$1,286 billion and its GHG emissions 690 million tonnes. That equivocates to just under 537 tonnes per C$million turnover. Therefore a C$50/tonne price on carbon would equal about 2.5% of GDP, less than the government’s own estimation of Canada’s 2008-2009 economic shrinkage caused by the global financial crisis.

At $50/tonne, what revenue neutrality and fiscal shifting could be achieved and also invested in a low-carbon future? In short, much.

The political reality however is that any government addressing the carbon tax or cap and trade will face a barrage of pressure against either. Iron pelletizers will cry foul play that they have incorporated more carbon footprint for the benefit of their downstream supply chain. Ditto aluminium producers will argue their carbon intensity has benefits for their downstream clients in terms of lighter transportation, although RioTintoAlcan will likely demand early action credits for emissions reductions resulting from implementing their innovative technologies since 1992.

RioTintoAlcan’s carbon footprint may be good in Quebec where Lac St Jean provides their hydro power, but in coal-fired South Africa, the reality is far different.

Data analyst company Trucost noted in 2009 that the average carbon footprint of mutual and hedge fund investment targets was 335 tonnes per million turnover; the worst offender China’s biggest coal-fired polluting power stations with over 1,500 tonnes per $million turnover. At $50/tonne, 335 tonnes equivocates to $16,750 per $million turnover, 1.675 per cent of corporate turnover – and that would be to address all emissions, not just reduce them between 25-40 per cent.

Each industry sector faces its own challenges; its own opportunities. Aviation emissions require better navigation and direct flights, otherwise technology improvements will gradually reduce energy consumption, a shift towards biofuels and alternative fuels is the only other alternative and large-scale take-up is difficult to project.

The mining and metals industry can achieve a lot, particularly in metals processing where waste heat recovery technology can make certain reductions; Alcan’s Pecheny technology has again set out to achieve a further 20 per cent emissions reduction over and above the original Pecheny 35 technology that reduced emissions from 6 tonnes of CO2/tonne of aluminium to 2.8 tonnes of CO2.

The cement industry has made its own advances.

It does not take much imagination for the Canadian, or any government yet to seriously address its greenhouse gas emissions, to devise sector-based targets that are deeply science-based, these days trending towards the higher end of the 25-40 per cent reduction target below 1990 levels, and then offer a 1% corporation tax reduction for companies who achieve them.

On face value, it would cost companies nothing if they choose to make no reductions at all.

Importantly, however, the signal to investors is that if they want to maximize their return on investment (ROI), they will need to demand their executive boards to achieve these targets. They will ask for no excuses or otherwise they will start to identify alternative investment targets that are capable of reaching these standards.

More curiously, companies who just miss qualifying for their corporation tax reduction might start to ask for a carbon market in order to buy the surplus emissions from companies over achieving their reductions targets but who qualify for no further reward. This could kick-start both an informal market price for carbon emissions, create a multiplier effect hopefully within the economy among companies addressing their emissions but furthermore sow the seeds for a grass-roots call for a carbon market.

Also, depending on where thresholds are set could include more than just the big emitters, instead embracing a wider selection of Small and Medium Enterprises (SMEs) The subsequent need to verify, audit and report corporate energy and emissions profile would create its own service industry as well as reduce operating costs of companies identifying emissions reductions and energy improvements who  can seek to reduce emissions accordingly, whether through fuel-switching in the case of a power station or reducing sales representatives’ mileage.

So the answer Fred Delorey is that a any carbon price at all is far from a tax. Technology push and market pull or a vice versa scenario of market push and technology pull just requires good government policy, not irresponsible spin.

Harper government reaches out to women

Monday, September 17th, 2012

Canada opposes moral relativism in asserting greater women’s rights in free societies – Felix von Geyer in Montreal

In a speech that cribbed John F Kennedy’s idealism, Canada’s Foreign Minister John Baird championed so-called Canadian values over partisan politics on Friday as he described the road to progress as the road to freedom and that the state’s role is to protect its people regardless of gender, sexuality or faith.

Stephen Harper’s Conservative government is against moral relativism, Baird told the Montreal Council on Foreign Relations. “We believe what’s right is right… and what’s wrong is wrong,” continued Baird after highlighting cases he stated violated women’s, children’s and gay rights in countries such as Niger where he cited a 14 year old girl Habiba being forced into marriage, and Uganda where Gay-rights activist David Kato was murdered.

Earlier this year Baird, who has neither confirmed nor denied public rumours and statements surrounding his homosexuality, defended gay rights in a speech to Seventh Day Adventists in the United States, a religious group opposed to homosexuality as the Bible makes no provisions for it.

In both his speech and in subsequent answers to audience questions, Baird defended his decision ten days ago to close Canada’s embassy in Tehran due to Iran’s “abysmal human rights record,” he said.

“People are fighting for dignity,” said Baird as he described a common denominator in today’s rapid changes around the world that he broke down into three essential dignities: to live in freedom; to live in peace and to provide for one’s family.

While Baird described Canada as a “beacon of light…built on values of freedom, democracy, human rights and the rule of law,” liberal democracy cannot be forced upon other societies, although he is “aggressively pursuing a foreign policy to protect the fundamental liberties of people around the world,” he said.

In what appeared to be a rebrand of Prime Minister Stephen Harper’s neo-Conservatism into a form of caring Conservatism, Baird echoed Enlightenment philosopher Jean-Jacques Rousseau by stating that “people are born free” before he used John F Kennedy’s line that “The best road to progress is freedom’s road.”

Poignantly, Baird stated that this commitment was shared with like-minded institutions such as the G8, G20, Commonwealth, Francophonie and “some parts of the United Nations,” he said. Canada withdrew from the UN Kyoto Protocol where the former Liberal government committed the country to reduce its greenhouse gas emissions by 6 percent below 1990 levels by the end of this year.

Instead, Canada’s emissions are about a quarter more than 1990 levels and even if Harper’s government realizes its revised target by 2020 in line with the US to reduce emissions 17 per cent below 2005 levels, the country will likely remain at least 8 percent above 1990 levels.

Harper’s government hosted both the 2010 G8 and G20 conferences where they emphasized maternal and newborn health initiatives but steadfastly refused to include abortion on the agenda.

In his speech Friday, Baird declared that to “cut off radical extremism at the knees” required more than just equality of men and women but the full participation of women in all parts of civil society .

“Each of us, working toward furthering human dignity, respect and tolerance, will be able to write the history of our generation.”

Such conviction said Baird would drive us to stand up for the rights of women; stand up to the violent mobs that seek to criminalize homosexuality and the terrorists who prey on religious minorities seeking only to practise their faith in peace.”

While Baird stated that US Secretary of State Hillary Clinton had asked him to spearhead the discussion on women, peace and security at April’s G8 Foreign Ministers’ meeting, his claim that “these are not partisan politics, they transcend politics” and that these “distinctively Canadian values shaped by our national experience,” might serve a different purpose.

As federal MPs prepare to reconvene from the summer recess in Ottawa on Monday for what will likely be a further contentious session of Parliament over budgetary issues, the Harper government is well aware that the federal Conservatives are almost the last resort for approximately three-quarters of female voters.

Bridging this gender gap, in particular appealing to urban and suburban female voters, a majority of whom are likely to vote the federal Liberal Party according to some polls, will be a major focus as Harper’s Conservatives try to position themselves into a catch-all party.

A Harris-Decima poll in June indicated a big surge in Liberal support is likely should Montreal MP Justin Trudeau, son of former Canadian prime minister Pierre-Elliot Trudeau and Margaret Trudeau, decide to run for the federal Liberal leadership later this year.

Airport security to include cargo and airport staff

Thursday, September 13th, 2012

UN body agrees to extend airport and aviation security – Felix von Geyer

Airports will soon look to undertake more security checks on cargo, mail and non-passengers such as airport employees in a bid to eliminate security threats notably from terrorism.

At a conference of the UN body the International Civil Aviation Organization at its Montreal headquarters, members were unanimous in their commitment to extend security arrangements on Wednesday, the day after the eleventh anniversary of the terrorist attack on the World Trade Centre that killed over four thousand people.

Delegates expressed their condolences also to the United States and the family of the victims of the US Embassy in Benghazi where Ambassador Chris Stevens and two of his staff were killed by Libyan rioters, many of whom have been described by media reports as former rebels against the late Colonel Gadafi’s regime. The attack on the embassy is alleged to have been in protest against a US television documentary on the Prophet Mohammed that many Muslims have called blasphemous.

The European Union called for stronger rules for air cargo screening throughout the supply chain but insisted this will not need to add further layers of security to enhance the process.

In fact one-stop security would provide lower costs and combined with a risk-based approach and capacity-building to enhance, for example, developing country capacity to undertake efficient and cost-effective security screening were prescribed as a good model for states to adopt in assisting each other.

However, security audits, information disclosure and compliance procedures are necessary, stated the EU delegation who called for ICAO to take leadership over the issue.

The US Secretary for Homeland Security Janet Napolitana called for more transparency in ICAO’s universal security audit programme””while respecting sovereignty,”she said.

Napolitana stated that mail security and cargo required more attention and security measures should also enable items to be transported more rapidly.

However, where many ICAO members were content for ICAO to move forward and agree these enhanced security measures by 2014, Napolitana called for ICAO to address these issues at the forthcoming two-week long ICAO Council meeting scheduled for the end of October. “We need collaborative agreement and actions now, not wait until 2014,” she said.

Furthermore, ICAO should take the lead in defining the next generation of travel documents such as travel cards for international civil aviation.

Later in the afternoon, ICAO Secretary General Raymond Benjamin acknowledged interventions from the floor and called for non-passengers to be screened, known as the ïnsider threat”where airport employees could also be infiltrated by terrorist organizations and subsequently pose a threat to aviation and passenger security.

To some, the issue of screening is more of a diplomatic process rather than a logistical difficulty. Integrated technology solutions exist making efficient screening accessible and possible as well as universal. Security audits would then clarify the efficiency of personnel clearance, verify the number of audits as well as the quality and compliance procedures when suspicious items or people were encountered.

In addition, enhanced training of airport security personnel in risk-based approaches and forensic techniques for screening terrorist behaviour would also enhance security.

Public disclosure of this information would not be necessary said one ICAO spokesperson, indicating that it is preferred that prescribed security measures remain unknown to terrorists or other persons who may seek to circumscribe airport security measures.