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The Hon. James  Cowan, Q.C., B.A., LL.B., LL.M., LL.D. Senator James Cowan has greatly influenced the educational and legal communities of Nova Scotia. He was appointed to the Senate on March 24, 2005 by the Rt. Hon. Paul Martin.

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Senator Mitchell Speaks to the Third Reading of Bill C-288

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Statement made on 29 May 2007 by Senator Grant Mitchell

Hon. Grant Mitchell:

Honourable senators, it is with a great deal of pleasure that I rise to speak to third reading on Bill C-288. I say "pleasure" for a number of reasons. This has been a difficult process, although perhaps a process that reflects the great resilience of democracy and democratic debate. It has been difficult to get the bill this far. At the same time, it is what I believe to be an historic bill that addresses the issue of our generation, the issue of the 21st century.

I begin by praising the work of the committee. I say that with great sincerity, and address all sides of the committee. I believe that the committee dealt with the critical issues addressed under Bill C-288. Essentially. those issues include whether or not this proposed legislation will harm the economy, as well as what will be the trade-off between investing in the pursuit of Kyoto objectives and what may happen, good or bad, to the economy.

We have had significant debate on the issues. We were fortunate that, although there is so much information, we did not have to spend months and months reviewing it, but instead the selection of witnesses reflected very well both sides of that heartland issue — economy versus the environment. It is also important to note that the committee addressed another significant issue and that is question of tradable permits and how those markets might be structured.

It was after those particular hearings that I had the profound sense that we had dealt in depth and in detail with the very significant, core issues that Bill C-288 addresses. What was also interesting is that the Conservative side made no effort to call anyone who questioned the science. I assume that is no longer an issue in their caucus or in their thinking, and that they would not be saying that committee hearings were not adequate because that particular issue had not been addressed. In fact, they did not call any witnesses.

I respect greatly the efforts and intensity with which the Conservative senators have addressed this issue and the intensity and manner in which they handled themselves in committee. It was clear that no matter what perspective a given witness represented, that witness was questioned rigorously by both sides of the issue, as reflected by members of the Liberal caucus, by independent members and by members of the Conservative caucus on the other side. It is fair to say that every senator brought a great deal of understanding and commitment to this issue. There is no question but that the issues and questions that have arisen around Bill C-288 were rigorously pursued in the committee process and were well represented on many sides by the witnesses who were called.

I thank the chair, Senator Tommy Banks, for his work with the committee. It is not an easy process when a bill of this nature appears. This is a contentious bill and addressed people at a deep value level. Therefore, the decorum of the process should be applauded, and I thank Senator Banks for the work he did for the committee.

In the end, the committee did a comprehensive job, the issues were reviewed properly and more than adequately, the debate proceeded well, and here we are with a chance to further that debate still.

I would like to address a series of issues. Senator Murray raised the first issue. As I have said before, I have great respect for Senator Murray's view of these things. I think it was very useful for the committee to have addressed the question of whether or not it is proper within the parliamentary structure and process for opposition MPs to hold the government to do something that it may choose not to do or simply does not want to do.

In essence, Senator Murray's concern is that an opposition coalition could render a government unable to use the its prerogative without the opposition having to be held accountable for whatever it is that it is making the government do.

It was interesting to note that the two witnesses who were called were both eminently qualified; Linda Collins, a professor of law at the University of Ottawa and Professor Hurley, a professor of political science who is now retired. Professor Hurley has consulted to governments of both stripes. Both professors, well respected in the community, argued that Bill C-288 supported as it is by a majority of the House of Commons underlines the supremacy of Parliament and is perfectly within order. Professor Hurley went on to say that it is unprecedented that a government should be put in this particular position. Of course, it is unprecedented because it is only recently that the members of Parliament have had the power to vote in this way on issues of real substance. That is a fundamental change and there is a history surrounding that change. In fact, one could argue — as I did in committee — that the change probably emanated from the work and concern of the Western-based Reform Party. The Reform Party pointed out that MPs need to be heard and have more power. Lo and behold, MPs have more power and they should be listened to, although this government has gone to some extent to try to prohibit that function. The fact of the matter is that this is now in place. Members of Parliament have this power. If the circumstances arise again as they did this time, they can get together in a majority and hold a minority government to do something that it may choose not to do.

First, you cannot go back on that and, second, it is not as though the government did not have further prerogative to inhibit or prevent this problem. The government could have called a question of confidence on that bill.

You cannot on the one hand argue that the government lost its prerogative because members of Parliament in opposition voted to force it to do something overwhelmingly significant and then diminish the fact that it had prerogative to prohibit this problem simply by calling a confidence vote on this particular issue. Therefore, it is one of the remarkable features of this parliamentary process that often compensates for these different initiatives in the process of evolution and that, in fact, there was the power of this government, had it not wanted power more than it did not want to achieve Kyoto objectives, to have prohibited and prevented this from ever occurring. Had they called a question of confidence, it might be that it would have resolved itself differently. However, they did not do that, but they did have the prerogative to fight this pressure that came from members of Parliament who were exercising a perfectly legitimate power accorded to them somewhat recently.

Regarding substantive issues with respect to the bill itself, clearly, the heartland issue in this bill — and it is very clear as it continually arises in debate — is the question of economy versus environmental investment. Can you have both? Can you walk and chew gum at the same time?

The one clear and overriding position that the government seemed to want to take, if disappointing, was the day that Minister Baird appeared and made it clear that they wanted to link the pursuit of the Kyoto objective to some kind of economic destruction.

Minister Baird presented a study — I use that word lightly — to somehow defend that there would be economic ruin descended upon Canada should Kyoto be achieved to the end of 2012, the first phase.

Mr. Baird should actually be quite ashamed of himself for having presented this report. The report itself diminishes, pretty much precludes, any credibility it might have had on the question. The report states that the analysis cannot, for example, credibly incorporate such long-term transformational technology such as carbon storage, it cannot include the emissions impacts of long-term energy infrastructure projects such as new plant hydroelectric generation capacity in Northern Quebec and it cannot accommodate business capital turnover cycles. While the two previous items are specified as being long-term technologies, they certainly have not considered the short-term impacts, and the business cycle could be much shorter in many industrial or business-specific cycles.

They cannot allow for an evolution in consumer awareness and behaviour. They did not allow for that. Consumers can change quite quickly. In fact, political analysts have changed. Yes, we will talk about Buzz Hargrove.

The government could not wait for the development of the implementation of solid international certification procedures with respect to green AA use, which could transform this process. This study is not worth the paper it was printed on. It was too bad Minister Baird had expended the energy to produce the paper to print this thing because it is absolutely without credibility. Interestingly enough, it is the only study they have ever produced to show that there might be some economic damage.

It is interesting to note that the Chemical Producers' Association appeared in the committee and reported that their industry is 56 per cent below their 1990 levels of CO2 emissions.

Even the minister argued, as the association had argued for a long time, that this would hurt the economy. When pressed, I asked on what information he based his argument and he responded that the government had the study. I asked him what he had been using prior to the study. I pointed out that the government had been using the studies of the Chemical Producers' Association for years and that no other studies existed on which to base a firm conclusion. That brings me to my point.

Why is it that somehow we accept this myth that pursuing Kyoto must hurt the economy? There is not a breath of suggestion that when we invest in guns, tanks, helicopters and a war halfway around the world that somehow that damages the economy. There is not a breath of suggestion that it damages the economy because, of course, it does not. Unfortunately, for the wrong reasons, it stimulates the economy, as most investment does.

Why would we conclude that investing to achieve Kyoto targets would inherently and definitively hurt the economy? Why would we come to that conclusion when evidence tells us that when businesses or countries work together on a major environmental initiative, it is absolutely to the contrary? When entities collaborate, the cost is less than is initially prescribed; it often takes far less time; it often ends up, if not always, in making businesses more competitive and efficient; and, in fact, there is ample evidence to show how it simply stimulates economies and improves businesses.

I will paraphrase a quote by Lee Iacocca when he was head of Ford Motor Company in 1973: If we are forced to put in catalytic converters, Ford will go down, 800,000 jobs will be lost and small towns will go under because they will lose a tax base. That never happened.

With respect to CFCs, DuPont said there would be a $135 billion cost to fix the CFC issue and that whole industries would fold. That never happened. It was believed that acid rain would somehow create a recession. In fact, it never happened. Companies like Inco fight these initiatives. They go through a cycle. First, they say there is not a problem; then they admit the problem, but it is not their fault; then they continue to admit there is a problem, but it is too costly to fix it. Then, when they are forced to fix the problem, they fix it and extol their environmental virtues. That is exactly what companies like Inco did after they fixed the sulphur problem.

There are many examples. Chemical producers fall 56 per cent below the Kyoto objective. That is nine times their Kyoto requirement level, 56 per cent below 1990 levels. The forestry association falls 44 per cent below 1990 levels of carbon production. That is seven times their objective. In answer to that, the small "o" opposition will say, "Yes, but they had 17 or 20 years to achieve this result." They achieved the result seven or nine times more than they had to, so they were doing 3 or 4 per cent a year. They have five and a half years to get to 6 per cent below target. They have lots of time if they just apply themselves. That is very serious.

Countries have done this. The manufacturers association pointed out that their membership is 7.4 per cent below 1990 levels of greenhouse gas production and that their efficiency has increased by 48 per cent.

Let us look at examples, if they exist, of where greenhouse gas emissions reduction damages economies, because it does not damage economies. When business leaders, political leaders and individuals have vision, it is remarkable what they can do. I look at this Conservative government and ask: Why is it that you cannot grab the vision, see the potential and see what is facing you directly, namely, the possibilities for this country and for our role in the world?

The other issue is cost. The government says there will be a huge cost, which is a refinement of the "it will wreck the economy" argument. Let us think about the cost. Currently, a tradable credit in Europe — and these are real credits, which I will address later — is trading for about $12.60. We have to reduce our greenhouse gas emissions by 260 megatons from business-as-usual 2010 levels. If nothing is done between now and then, we have to reduce emissions by 260 megatons.

If one takes $12.60 by 260 megatons one is talking far less than $4 billion a year. It will take less than $20 billion a year over the next five years for us to meet our Kyoto obligations if we did not do a single thing to reduce emissions, if we simply bought credits so emissions could be reduced somewhere else in the world. Twenty billion dollars is less than the government has forfeited by reducing the GST by 1 per cent. It is less than one half and probably less than one third of 1 per cent of our GDP.

Emissions reduction will not have the kind of economic impact that the government and the Bairds of the world are assuming, without any basis whatsoever, that it will have. The reverse is true. The reverse is that this is the next industrial revolution, that we actually have an opportunity to do something significant to build the next economy, an economy of the future for this country that will be competitive and keep us ahead economically, as we have been to this point.

I think of BIOCAP. One of the committee witnesses had a company which is a member of BIOCAP, which is a network of researchers across the country, highly credible and backed by companies like TransAlta, Lafarge and Shell, who are looking for ways to produce tradable credits through biomass and agriculture and forestry. The potential there is great.

This government recently cut its $2.5 million annual funding to BIOCAP. Why can they not see the opportunity where we can actually create another stream, maybe a truly economically driven stream of revenue for the agricultural and forestry communities? Not only can they not see that, but they have also absolutely thwarted the great work of BIOCAP by cancelling their funding.

In regard to transformative technologies, why can this government not see the potential for surveying the technological possibilities for reducing greenhouse gas, picking several possibilities and then backing them through our universities, our industry and our own government initiatives in a collaborative effort, a venture that could see us build breakthrough technologies? Some technologies are close to breakthroughs in terms of cleaner burning of coal and producing more concentrated streams of CO2, for example, that can then be captured.

Imagine if we could think of the technology that would allow that to occur for coal-fired electrical plants. In the not-too-distant future, China will be producing as many as three coal-fired electrical plants a week for who knows how long. Would it not be remarkable if it was Canadian technology that could be sold and Canadian industry that could be building those facilities?

When we have a government that cancels every single program in place out of hand and sends the clear message that it does not believe in Kyoto, then we have a government that does not have the understanding, vision and creativity to build an economy of the future. It is terribly frustrating and disappointing.

The second important issue that arose was in regard to tradable credits. We have heard the standard opposition and criticism: We will not allow Canadian companies to buy hot air. No Canadian company has bought hot air, in Russia or anywhere else. There are structured international organizations that ensure, under Kyoto parameters, that credits that are traded on legitimate markets are in fact legitimate. It is interesting that our stock and real estate markets operate very much on the assessments and expertise of auditors and accountants, and we accept those reports and analyses. Clearly, we will be in a position to accept the reports and analyses of these organizations when they say this is a legitimate, valuable and valid tradable permit.

For the government to continue to say that we cannot do that, honourable senators, is to find excuses that make no sense. The fact of the matter is that tradable permits are a way to transition from where we are to where we have ultimately reduced our emissions completely. Right now, there are fundamentally significant market mechanisms that work.

One of the witnesses who appeared before us is a representative of a company called Natsource, which represents 26 huge international corporations that are in jurisdictions that require them to find legitimate tradable permits. They have a $670 million market right now that they have developed and are using to develop tradable permits. This is a real company working for major corporations, and it has to deliver real tradable credits or it will be fired or it could be sued; it would have all of those remedies to face. To say that somehow these markets are not or could not be real is absolutely wrong. They are real and they can be real. Again, because the government denies this, we will miss the opportunity to build those markets in Canada.

I might put in a plug now that the market for Canada in tradable greenhouse gas permits should be in Calgary, where there is already tremendous infrastructure. There is tremendous intellectual capital there, an understanding of markets, and direct interest in finding proper tradable permits because its head offices in Calgary certainly have to confront the question, and they are confronting the question of greenhouse gas emissions. Again, we simply see a government that cannot, for whatever reason, grab the real possibilities, and marketing for tradable credits is one of those real possibilities.

I wish to mention another issue in passing. Clearly, this government has staked a huge amount of its political credibility, such as it is, on international security. That is why it is supportive, one would think, of what the Americans do and why our troops are in Afghanistan. There is ample evidence that climate change will create tremendous international insecurity if it continues to evolve in the way that it does. No amount of military action that we could even begin to afford probably could offset that. If we want to be preventive in the area of international security this, again, is an area that we have to address and address quickly and effectively.

When I assessed the witnesses and the debate, as I have heard and understand it, I was struck by this strange contradiction. There are all kinds of elements to pursuing Kyoto on climate change policy that should appeal immensely to a Conservative frame of mind. There is a huge economic opportunity if we could only have the vision to develop the infrastructure, the research and development, and the marketing that is required to do that.

The other side of the argument is that if we do not take action, there may be a huge economic downside. The newly elected President of France recently said that he will be imposing highly punitive import duties on the products of countries that do not respect Kyoto. There is a downside to this approach. I would argue that if we want to hurt the economy of this country, we must continue to do what we are doing. If we want to build an economy for the 21st century, then we must pursue Kyoto.

One would think that a Conservative frame of mind that is so business driven would see approach and want to grab it. The Conservatives that I know are very concerned about agriculture. BIOCAP is a classic case of the potential for developing agricultural products that will hold more greenhouse gas that could be sold as tradable credits by farmers to industry that need tradable credits. There is a stream of cash flow, a potential revenue source and they cannot even find $2.5 million to put into BIOCAP to make it possible for them to pursue the research they have been doing up to this year when their funding was cut off.

We have economic potential. One would think that would be a Conservative initiative. We have agricultural economic potential. One would think that would be of interest to Conservatives. We have helped to provide security around the world. Security seems to be something that is of interest to Conservatives. We have a place in the world, the leadership. One would think that that would be of interest even to Conservatives.

All of these observations argue for embracing Kyoto, not fighting it, but embracing it and none of it happens. How could that possibly be? What is it that underlines that contradiction? For the life of me, I cannot see it. I do not know whether the Prime Minister simply cannot judge or understand. He has the potential to be a great prime minister because he is confronted by a great issue. It could be said that Churchill was not great until the Second World War because he confronted a great issue. Our Prime Minister could address this issue. What does he do? He reduces us down to the minimal. He does not even bring that agenda to the House.

Senator Oliver: That is not right.

Senator Mitchell: That is why he can barely keep the place going. He does not understand the possibilities of what he could do to build this country. There is one explanation: No sense of vision; no sense of what is possible; no sense of greatness. He is blessed in a way that was not the case in the late 1990s and early 2000s by a population whose attitude about this has changed. About 60 per cent of Canadians in the polls are indicating they want something done about Kyoto and 60 per cent have said that they do not like what this government has done and they do not like their plan.

The Prime Minister has the economic potential and a population that is ready like never before to accept the need to pursue Kyoto. He has the possibility to provide leadership so that collective action can be taken by individuals across this country to achieve something great. He simply cannot do it.

Another explanation that I have come across — and I am somewhat sympathetic, but it is not enough — is that Conservatives do not like government to tell them what to do. Most of us do not like government to tell us what it do. I think that may be what sticks in their craw because environmental regulation will bring with it possibly some form of government.

Senator Oliver: Dictatorship!

Senator Mitchell: Dictating to them what they have to do.

Sometimes there is something bigger than our own specific concerns in that regard. What is bigger is the future of this country, the future of this planet, our families, our grandchildren. I look at a Conservative government that talks a great deal about family values. If they do not consider the next generation and the generation after that and what climate change may do to them, what credibility do they have when they talk about family values?

I will leave it at that and say that I feel a tremendous sense of frustration in the arguments that I hear from government, the fight that they fight for what seems to be reasons that would contradict even their basic fundamental understanding of what government could do and their objectives in society.

I feel that the potential is great for us to do something significant as a country and it is absolutely affordable. The evidence is that it is not detrimental to economic development, but that it would be stimulative of economic development. Simply because this government has not been able to seize the moment and the opportunity to provide and clarify the vision and provide the leadership, Bill C-288 is essential and I am grateful to the members of the House of Commons who supported it and I look forward to honourable senators supporting it as well.

 

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