Ragan Recruits Canada Ex-Politicians to Study Environment Policy

Former Prime Minister Paul Martin and three former provincial leaders including Quebec’s Jean Charest are among those backing a new research organization seeking to remove politics from Canada’s environmental policy.

Christopher Ragan, a McGill University economics professor who has also held posts at Canada’s finance department and Bank of Canada, has recruited some of the country’s most-prominent former statesmen to help study the economic effects and missed opportunities of the way policy makers tax environmental costs. Ragan unveiled his Ecofiscal Commission in Toronto today.

Lawmakers are grappling with environmental policy in Canada, particularly at the federal level, as Prime Minister Stephen Harper aims to turn the nation into an “energy superpower.” Ragan says Canada’s fiscal structure is poorly designed with too much taxation of income-generating activities and not enough on pollution. People with experience in politics are the ones to help fix it, he said.

“I don’t believe politics is a four letter word,” Ragan said in an interview last week at Bloomberg’s Ottawa office. “Politics is a good thing but our job is to lay out what the economic options are.”

Other former politicians who will sit on the group’s advisory board include Jean Charest, former premier of Quebec, Michael Harcourt, previously premier of British Columbia and Ontario’s Bob Rae. Preston Manning, former leader of the federal opposition, is also among the group of advisers for the project.

Research commissioners who will produce the reports include Mel Cappe of the University of Toronto, the federal government’s head bureaucrat for three years between 1999 and 2002, Paul Boothe of Western University in London, Ontario, a former deputy minister of the environment, and Don Drummond, a former chief economist at Toronto-Dominion Bank.

Carbon Pricing

While Canadian federal, provincial and municipal government gather revenue totaling about one-third of output, environmentally-related taxes take up only 1 percent, he said.

Harper has ruled out carbon pricing, preferring instead a regulatory approach, one industry at a time. The opposition Liberal Party, which has been advocating carbon pricing, has seen its support steadily decline in recent elections.

The debates over how to price environmental damage may be more appropriate for regional jurisdictions, Ragan said.

“We think most of the opportunities here are well suited for provincial and city action.” Ragan said. “We need to respect regional differences.”

While Canada doesn’t have a national price on carbon, British Columbia taxes about 70 percent of carbon consumption and Alberta imposes a levy of $15 a ton for large emitters of greenhouse gases.

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