Cleanup on aisle bullshit

When it comes to climate change, the Fraser Institute always misses the mark. This time, they managed to outdo themselves

Death, taxes, and questionable studies from the Fraser Institute on climate change: these are the certainties we can count on in life. And true to form, the Fraser Institute churned out another whopper — one that was immediately and uncritically boosted by pundits at Postmedia and other right-wing organs. Black Press, which has community newspapers across BC (and whose owner, David Black, once tried to build an oil refinery in northern BC), was particularly shameless in spreading its findings.

Those findings, such as they are (more on that in a moment), were entirely predictable: the federal carbon tax is bad for the economy, will kill many thousands of jobs, and do little to actually address climate change. The “independent” study, which is splashed out on a spiffy website that seems designed to influence rather than inform, suggests that by 2030 there will be a 2.1% decrease in national GDP and 200,000 fewer Canadian jobs as a result of the carbon tax.

How did they arrive at these results? As it turns out, by totally misunderstanding the legislation they were critiquing. The report excluded the so-called “output based pricing system”, which protects so-called “emissions intensive, trade-exposed” industries from the full weight of the carbon tax and gives them time to adapt and adjust. You might think that this would have some bearing on the economic impact of the federal carbon tax, given that the OBPS is applied to some of the biggest emitters in Canada — including the oil sands.

Twitter avatar for @dion_jasonJason Dion @dion_jason
Fraser Institute's analysis of CDN carbon pricing acts as if output-based pricing (OBP) doesn't exist, leaving a gaping hole in the analysis. Ignoring the effect of policy that protects competitiveness overstates costs. Explainer on OBP and why we have it:…

Lorrie Goldstein @sunlorrie

My Tuesday Toronto Sun column: Federal carbon tax will cost more than 200,000 jobs, $1,800 in less income per worker annually, a 2.1% drop in GDP ($44.1 billion in 2019 dollars) and increase government deficits by $24 billion, says new study: #cdnpoli

Even worse, the report justified ignoring the OBP system on the basis that it would be phased out by 2030. Except, of course, that isn’t happening. The electricity sector will exit the system in 2030, in part because it’s not actually trade-exposed (a company can’t exactly relocate a power plant the way it can a factory) and in part because coal power will be phased out by that date.

I brought this error to the attention of the report’s authors, and one of them, Ross McKitrick, acknowledged the mistake. “After checking into it you are correct that the OBPS is only being phased out for electricity. That was my mistake--I misread the regulations. The overall effect will be to reduce the national GDP loss from 2.1% to 1.8% and the employment loss from 0.9% to 0.8%.”

Did the Fraser Institute issue a press release about this fairly substantial oversight? No. Did it tweet a correction? No. Instead, it buried the revision in the report’s footnotes. That’s because, as the Fraser Institute surely knows, what really matters here is the initial news cycle. There will be no follow-up stories explaining the error, and no Postmedia pieces in which the columnists who uncritically boosted the report’s findings dig into the flawed assumptions that informed it.

This is not the first time the Fraser Institute has made this mistake, either. Back in 2019, when it released its last criticism of the federal carbon tax, McKitrick — whose previous work at the U.S.-based Cato Institute include pieces like “Dilbert 1, Scientists 0” and “Climate Change and the False Case for Haste” — also failed to account for how the federal government’s system of output-based allocations works, and how it protects the competitiveness of Canadian companies.

You might think, given this track record, that journalists might want to look to see that this mistake wasn’t made again. But you’d be wrong. When McKitrick appeared on BNN Bloomberg to talk about his study, host Amanda Lang happily praised it, either because she wasn’t aware of the error in its assumptions or didn’t care. 

In that same interview, McKitrick said it was “unfair” for Mark Carney to be optimistic about the economic upside associated with the energy transition. But what’s truly unfair is that people like him get to trade in studies with the kind of flaws his so clearly has — studies that are immediately socialized and politicized by conservative pundits and politicians. The media, meanwhile, has to do a better job of vetting this stuff.

That is, if it actually cares about the truth.

Was KXL much ado about nothing?

For years now, Alberta politicians have sworn up and down that the Keystone XL pipeline was the key to the province’s prosperity. As it turns out, it may really have been about being key to TC Energy’s prosperity. After all, as the recent news of CP Rail’s US$25 billion takeover of Kansas City Southern railway shows, there may always have been other options sitting in plain sight. The combined railway, after all, will now be able to deliver Canadian barrels to the Gulf Coast — just as Keystone was supposed to.

Yes, it will get those barrels there with higher GHG emissions and greater safety concerns than a pipeline would. But in a world where the future of oil demand is very much an open question, the optionality that rail offers might actually be a better fit than a single-purpose pipeline. And as the Financial Post’s Geoffrey Morgan noted in his story, the new combined CP-KCS entity will compete with CN Rail for the business of Canada’s oil producers — a competition that should drive down their shipping costs.

“In combination, the combined railroad can offer one-railroad connectivity between Alberta and U.S. Gulf Coast markets via these existing KCS connections,” said Paul Bingham, director in the transportation consulting business at IHS Markit.

The deal could also reduce overall shipping costs by boosting competition between CP and CN, said Darryl Anderson, managing director for maritime and multimodal transport at Wave Point Consulting Ltd. in Victoria.

This is good news for Canada’s oil and gas producers, and it raises an interesting question: was Keystone XL really worth all the time and energy our elected officials have put into it?

Your tax dollars at work (well, sort of)

Last week, when pressed in the legislature to explain what performance metrics were being used to assess the War Room’s work, Energy Minister Sonya Savage suggested it would be evaluated on the basis of Alberta’s oil production. This was a ludicrous explanation, and a perfect example of spurious correlation, but it’s almost certainly less embarrassing than using actual performance metrics.

Case in point: the War Room’s attempt to respond to Jane Fonda, who came out swinging against Enbridge’s Line 3 at a recent protest. There’s nothing wrong with Stephen Buffalo’s message here, and it’s one that Ms. Fonda should probably hear. But with all of 139 subscribers — at least half of which are probably UCP issues managers and press secretaries — how on earth is that ever going to happen?

This is supposed to be a sophisticated communications operation with a multi-million dollar budget. If this is the best they can do after nearly two years in operation, what are they really doing with our money?

One cool thing: Portable solar panels

As far as camping goes, I’m a bit of princess — and if there’s not a hot shower available to me, I tend to get grumpy in a hurry. But now, thanks to these ludicrously cheap portable solar panels, I won’t have that as an excuse for not wanting to head into the great outdoors.

Rest assured, though: I’ll find other reasons not to go.