goldstein: why carney and trudeau should be cheering for a tariff-induced recession
according to their own bizarre logic, prime minister ju...
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according to their own bizarre logic, prime minister justin trudeau and liberal leadership frontrunner mark carney should be overjoyed that u.s. president donald trump’s tariff jihad against canada may cause a massive recession here.
that’s because if it does, it will cause a dramatic drop in canada’s industrial greenhouse gas emissions, moving them closer to trudeau’s unachievable target of reducing them to at least 40% below 2005 levels in 2030 and to net zero by 2050.
actually, we’d need another couple of recessions between now and 2030 to hit that target and here’s why:
there are only two times in the modern era that emissions in canada dropped dramatically — during the 2008-09 recession set off by massive fraud on wall street known as the subprime mortgage derivative scandal, and during the 2020 covid recession.
the reason emissions drop in recessions is that there is less economic activity as people lose their jobs and thus have less income to buy goods and services, almost all of which are created using fossil fuel energy, while those who still have jobs become more cautious about spending preferring to save their money in case of job loss.
less demand for goods and services means fewer are produced, reducing the amount of emissions needed to create them.
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according to the federal government’s latest data — which is always two years out of date and changes retroactively every year — during the 2008-09 subprime mortgage derivative scandal, canada’s emissions dropped by 61 million tonnes or by 7.9% from 777 million tonnes in 2007 to 716 million tonnes in 2009, before they started rising again in 2010.
in the first year of the covid pandemic in 2020, canada’s emissions dropped by 66 million tonnes or by 8.8% from 752 million tonnes in 2019 to 686 million tonnes in 2020, before starting to rise again in 2021.
by comparison, without a major recession, canada’s emissions in 2022 went up by 10 million tonnes, an increase of 1.3%, from 698 million tonnes in 2021 to 708 million tonnes in 2022.
(actually that works out to an increase of 1.4%, but i’m using the government’s figures from its own announcement.)
to hit trudeau’s 2030 target of cutting annual emissions to at least 40% below 2005 levels would require a cut to 457 million tonnes annually in 2030 (60% of 2005 emissions of 761 million tonnes).
that means that based on the federal government’s latest available data, it has until 2030 to cut our current annual emissions of 708 million tonnes annually by 251 million tonnes (708-457) or by 35.5%.
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this would by the equivalent of eliminating all annual emissions from canada’s oil and gas sector (216.7 million tonnes in 2022) by 2030, plus 72.5% of all annual emissions from the electricity sector of 47.3 million tonnes.
that’s a fantasy.
i’m not suggesting trudeau and carney actually favour a recession, just that this is where their own “logic” inevitably leads.
but that said, in a truly idiotic application of the trudeau carbon tax, as we may be heading into a recession, it’s scheduled to increase by 18.75% on april 1 from $80 per tonne of emissions to $95 per tonne.
that will raise the cost of 22 kinds of fossil fuel energy, including gasoline by 20.91 cents per litre and natural gas by 18.11 cents per cubic metre since the tax’s inception in 2019.
raising the carbon tax as we may be heading into a recession is madness.
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