Three blind mice

With the Ontario election two weeks away, we've just been given a small opportunity to gauge the business and economics savvy of the three main party leaders.  It's not reassuring.

One of the joys of living in this Province is a little charge known as an "Environmental handling fee" (or EHF) that's levied on all electronics-related products -- from batteries (where it's a few pennies per unit) to big-screen TVs, where it can add more than $40 to the bill.  It was introduced a few years ago and it's wildly unpopular, although the intention of the fee -- requiring consumers to pay upfront for the end-of-life costs of what they buy, in return for the right to dispose of the items without charge at the end of their useful life -- is not a bad one.  If people have to pay to dispose of a broken TV properly, it's very likely that they'll just dump it in a ditch.

Anyway, all three party leaders have been quizzed by reporters about what they'd do with the fee if they became Premier after the election.  Current Premier Kathleen Wynne said that her party had already introduced legislation to have the fee paid by manufacturers and retailers, so that "it would just be treated the same as the rest of their input costs".  This would, I suppose, eliminate the annoyance that people feel when they see the EHF on their bill at Best Buy.  However, it doesn't seem to occur to Ms Wynne that companies recoup their input costs through the price they charge consumers, so if the EHF becomes just another input cost, it will be reflected directly in a higher price for the product.

NDP leader Andrea Horwath takes more or less the same position of Wynne.  She claims her party has always advocated that manufacturers should pick up the back-end costs for the products they sell.  Like the Premier, she seems unaware of the economic maxim that all taxes are ultimately paid by consumers.

Lastly we have Tory leader Tim Hudak.  In keeping with his overall anti-tax stance, he'd abolish the EDF outright.  He told a reporter that this would immediately result in a $40 dollar reduction in the cost of that 60" curved screen Samsung you've had your eye on. As the reporter on the story noted, there's at least as good a chance that the retailer or manufacturer would seize the opportunity to jack up the underlying price of the good by an amount equal to the fee.  And of course, with the fee gone, someone would have to figure out how to pay for the disposal costs of electronic items, many of which contain hazardous materials. Not an issue Hudak seems to have given any thought to.  (At a guess, the responsibility would fall to local municipalities: Tory governments always like to download expensive responsibilities, then claim they are cutting costs.)

The Liberals have spent the last several years demonstrating that they couldn't organize a two-car funeral. The opposition parties aren't even in power yet, and they're showing us exactly the same thing.