We live in a global context where we cannot separate environmental and economic challenges from the crisis of climate change. This presents us with an opportunity: By acting now, we can encourage the development and deployment of green energy technology in Canada and secure our prosperity for the long term.Just as Canada was outspending its fiscal capacity with repeated annual deficits in the 1980s and early 1990s, the vast majority of large industries, including our own, are dramatically over-polluting, dumping greenhouse gases into the atmosphere at a rate that is already producing irreversible ecological, social and economic damage.
Canada must take immediate action to balance this environmental deficit by setting absolute emission reduction targets and laying out a comprehensive plan to help industry meet them. It is clear that Canada's business leaders want and need to be part of this solution.
What they need is a plan that sets absolute reduction targets and creates the necessary tools to reach these objectives. Recently, the Liberal party put forward such a plan.
Our proposal puts industry on a carbon budget and sets absolute national greenhouse gas emission targets that meet our international obligations. It puts a price on carbon so industry can no longer treat our atmosphere as a free garbage dump. It sets up an accountable and transparent mechanism to have industry invest in its own efforts to tangibly reduce pollution.
It rewards early movers for their efforts to reduce greenhouse gases. It ensures new investments in green technologies are deployed in Canada.
And it creates opportunities for our businesses to participate in domestic and international emissions trading that rejects so-called "hot air credits."
In short, our plan stimulates investment to make Canada's economic future more sustainable while giving companies a wide variety of market-based options to determine how they can meet their reduction targets as cost-effectively and efficiently as possible. It also ensures that companies have access to and can compete within the emerging global carbon market.
In a report last month, TD Bank economists noted the advantages of using a range of market-based policies, subsidies and domestic and international credit trading to curb greenhouse gases.
The report notes that placing an appropriate price on excess carbon not only ensures that the polluter pays, it also alters business practices to spur innovation while reducing the need for further, more intrusive and costly environmental policies.
We can expect Prime Minister Stephen Harper and the Conservatives to continue arguing that capping greenhouse gas emissions is too expensive.
They are also likely to claim that producing a regulatory framework is all that is needed to adequately address the problem.
However, economists, including Don Drummond of the TD Bank, note that regulations alone are both economically and environmentally inefficient, as they don't encourage companies to reduce their emissions beyond the minimum threshold for compliance.
This short-sighted approach also sets up a restrictive regime that raises costs by taking market-based options like carbon trading off the table.
Many of Canada's industrial leaders support meeting the absolute reduction targets Kyoto demands.
A senior executive at Suncor recently told parliamentarians, for example, that his company did not "predict job losses or impact on the economy" because of meeting its Kyoto demands.
As well, reports have noted that Canada's oil and gas sector could increase profits by up to $1 billion a year while decreasing emissions by 29 megatonnes per year, simply by investing in efficiencies and plugging leaks.
The number of major corporations urging governments to implement caps on emissions tied to global warming continues to grow while the Harper government continues its irresponsible delaying tactics.
Because greenhouse gases accumulate and remain in our atmosphere for decades, we must chart an aggressive course of action now to get Canada's economy on a low carbon track.
As British economist Nicholas Stern's recent report estimated, taking global action now would cost approximately 1 per cent of the world's gross domestic product, but delaying action for more than 20 years would cause a 20 per cent rise "each year, now and forever."
So while some economists may caution that the short-term economic costs of taking immediate action on climate are too steep, these opinions must be balanced with the multitude of economic, social and human costs to the changes we are already witnessing due to the Earth's warming coupled with the increasing costs of inaction.
Canada must act aggressively to avert the destructive consequences of climate change and be a part of the solution.
By driving this change and rising to the challenge of our generation, Canada will not only be acting responsibly, it will also set a course to become the green energy superpower this nation can be.
StÃƒ©phane Dion is leader of the federal Liberal party.
© 2007 The Toronto Star