Progressive Carbon Taxes Roll Back Progress on Conservation
Vermont’s renewable energy programs conceal an economic assault on low-income Vermonters in the guise of saving the planet. A brief survey of historic income tax laws and comparison with so-called “carbon taxes” reveals unfair, elitist oppression of the working-class and retirees by those deluded that their conspicuous consumption of costly EV cars, solar panels, and heat pumps is saving the world.
Consider the American income tax system. Not all income is taxed the same — recognizing differences in the nature of income, and in the policies favored regarding certain investment or business practices, means that income is divided into different categories. The three chief categories are earned (active) income, portfolio income, and passive income. These are defined and taxed distinctly, for reasons that make sense.
Earned income includes that which is derived directly from labor: W-2 wages or Schedule C small business income (sole proprietorships) are the chief contributors here. These are subjected to social security and medicare taxes as well as income tax liability.
Portfolio income refers to income derived from selling an asset at a profit (which may be taxed as a capital gain or as ordinary income, depending on holding period). It also includes interest and dividends on investments (which are not subject to social security or medicare taxes).
Passive income describes rental income, royalties, and income from partnerships or other businesses or investment vehicles wherein the owner of the interest does not directly (materially) participate. There are other strange income tax categories, but these three constitute the bulk of what is described as “income” for purposes of the IRS tax code and regulations.
Carbon taxes are use taxes — they are applied like flat (regressive) taxes, on all carbon use without distinction. These are generally levied against fossil fuels like natural gas, fuel oil, or gasoline, but also on electricity use. These are essentially “sin taxes” designed to curtail or reduce use of these commodities to “save the planet.”
In truth these will do no such thing, and do little if anything to actually curtail consumption. In fact, these policies actually increase the use of these inputs when funds are then diverted to polluting manufacturing technologies such as EV cars, heat pumps, and solar panels — all of which accelerate carbon dioxide and pollution emissions. But that is not the discussion here, wherein we are addressing how carbon is taxed and whether that is “equitable.” It is most definitely not equitable whatsoever.
In classic regressive fashion, progressives who tax these fuels shift the greatest burden onto those least able to bear it. And the place where this happens most visibly is in the nature of their consumption — the gradations of passive, portfolio, or earned income are not applied to carbon dioxide. Let us analyze what that would look like, in a fairer world.
If carbon taxes are to be employed at all (they should not, because they cannot be applied equitably, are largely counterproductive, and fail to enhance personal responsibility for consumption), then they should be divided into categories. Fuels burned to heat a home, or drive to work, or produce food, should not be taxed at the same rate as fuels consumed to fly to a faraway vacation, or carry a recreational skier (or ATV driver) up a mountainside, or heat and light up a third vacation home. How is it fair to tax a little old widow on social security (which is not defined as earned income) for her electricity usage while she huddles in a drafty trailer beside a cheap electric heater in the bitter Vermont winter at the same rate as the energy for the hot tubs and chandeliers in Al Gore or Barack Obama’s massive mansions?
Vermonters already see a sales tax differentiation of this sort when they approach their gas pumps — off-road diesel is tax exempt to recognize that farmers use it to grow food, and is even dyed red to enable enforcement. There are no such distinctions evident in the reckless ideological renewable energy boondoggle. Many other innately unfair uses of energy do not distinguish between the lavish consumption of the wealthy while turning a callous eye toward the struggling-to-survive necessities of the impoverished masses: the “poor folks.” (Note: I do not advocate here for sin taxes on carbon consumption by the rich, I’m solely proving how grotesquely unjust and even criminal this has become)
Americans burn over 600 million gallons of gas each year in lawn mowers, which are free of pollution-control technologies and get worse mileage than most large cars. Mowed lawns now exceed in area the state of Texas. Instead of addressing this source, progressive dreamers seek to ban gas-powered chainsaws, upon which many people rely to endure freezing winters. Not very equitable.
Why should a trust-fund family whose income is passive or portfolio and subject to lower tax rates (like, say David Zuckerman’s clan) be allowed to drive four vehicles (including perhaps a big-engine sports car) and simply pay an “indulgence tax”? That lifestyle pollutes far more than the widower slaving away sweeping aisles at Wal-Mart at age 72 on (higher-taxed) earned income, who drives a twenty-year-old clunker. That doesn’t seem very fair and equitable, now does it? It is exactly the opposite.
These perverse inequities are visible on a grand scale for polluting corporations touting “carbon sequestration credits” — a factory spewing toxic smokestack plumes in California or Chicago can “buy” credits (read, license to pollute) from a hedge fund that bought up huge tracts of Vermont farmland to let the trees grow back to “sequester carbon.” Perhaps corporations should be able to “buy” Vermont streams and brooks to “offset” the frog-mutating carcinogenic sludge they dump into New York City harbors or rivers?
Where is Al Gore now, to receive awards for these and other inconvenient truths? Shouldn’t he take credit for creating this obscene disgrace? Where are the other climate warriors to explicate for us how they are equitably saving the planet? And when are the victims of this disgusting economic gang-rape of the American people going to rise up like many millions of raging Greta Thunbergs — only informed and ready to avenge this evil abuse?
Vermonters have long been the progressive petri dish for this dastardly idiocy, and are now feeling the full economic brunt of the faux environmentalism that appears designed to impoverish and enslave them. The state narrowly escaped a tax on heating fuels to fund costly heat pumps. The drafters of these policies are ludicrous self-proclaimed “social justice warriors” who more resemble anti-social, unjust, Scythians.
Vermonters aren’t stupid, despite being labeled that contemptuously by their elitist progressive masters. Perhaps progressives will lead Vermonters to yet new heights of inequitable policies to accelerate the destruction of the climate, culture, schools, communities, and people in the once-thriving Green Mountain State. Vermont’s climate-nurturing traditional culture is fast-disappearing under a gentrifying, regressive, arrogant infestation by disconnected dreamers who know not what they do.
The only path to reduce pollution and create healthy local food is through that very culture that the elitist climate warriors are mindlessly decimating. Vermonters’ accumulated agrarian knowledge and Great Depression frugality is a fast-depleted commodity, and once it is gone there will be no remnant remaining to save the planet from this astounding Icarian arrogance.
Carbon taxes are perversely, unconscionably regressive. Just like progressivism.
John Klar is a former tax attorney with PriceWaterhouseCoopers, and a candidate for Vermont State Senate.
Image: Image by David from Pixabay, Pixabay License, free for commercial use, no attribution required