Willem Post: Unilateral regressive carbon taxes a headwind for the Vermont economy

By Willem Post

A wise person would advocate putting the horse before the cart — that is, first use less energy, then build out the much lesser capacity systems needed for the energy still being used. This is so simple. Most people get it, but most pro-carbon tax folks do not.

Flickr/401kcalculator.org

“A unilateral carbon tax, $240 to $300 million per year, would further aggrandize state government, would raise the ante of foolish spending by about a factor of 3 to 4, and increase social discord.”

Pro-carbon tax folks want to have the unilateral carbon tax now so the state government would set up various programs, and folks would have to go through various hurdles to qualify to get some of their money back.

Here is one way the money would be used. Various subsidies would be used to finance high-efficiency duplex mobile home communities in Vermont’s Northeast Kingdom, with solar panels on the roofs and batteries on the wall, and efficient appliances and lighting, and heat pumps. It would be part of Green Mountain Power’s expensive “islanding/microgrid” fantasy.  Examples of such state-subsidized boondoggles can be found here, here and here.

The low-income residents likely would:

– Have minimal or no heating and electric bills
– Pay minimal or no rent
– Get food stamps and qualify for Medicaid, and other welfare goodies
– Pay minimal or no income and school taxes
– Sing the praises of the good that befell to them in pro-renewable energy press releases
– Vote for Democrat legislators forever.

Who pays for all the subsidies? Who pays the resulting higher prices for goods and services? Answer: Those who will pay the carbon taxes, and other taxes, surcharges and fees.

Anytime a politician says he going to extort a tax from you and “give it all back,” he means give some of it to back you, but most of it to his favorite constituents who voted for him.

Efficiency Vermont is a notoriously wasteful, quasi-government program audited on a cozy basis by the Public Utilities Commission. It is financed with an onerous, ever-increasing $65 million surcharge on electric bills, and is a perfect example of taxing the many and giving to the few who are “deserving” (i.e., willing to do things the expensive way to get some money back).

In the meantime, Vermont ranks 48th on business climate, per Forbes. A unilateral carbon tax and more government-directed, socialist-style redistribution programs will make it even worse. State-directed, socialist-style economics was practiced in the USSR and Cuba. We all know how that worked out.

Carbon taxes, subsidies and cost shifting

Vermont Sen. Christopher Bray, D-Addison, does not get it. He announced he wants to eliminate the sales tax on the first $30,000 cost of buying an electric vehicle. He wants to shift the burden of sales taxes from a few upscale-income buyers of electric vehicles onto all other taxpayers. That means upscale-income people benefit at the expense of others.

This means an $1800 saving for the upscale-income buyers, the state having less revenue, the state having bigger chronic deficits, and other taxpayers paying more. There is no free lunch, except in La-La Land.

Legislators like Bray have been giving away the store to please renewable energy constituents for at least a decade. Did Vermont’s annual CO2 decrease due to all these renewable energy giveaways these last 10 years? No. Throw more money at it? Oh yes, says Bray and other legislators. All the hyping about reducing CO2 to save the world was just to bamboozle the long-suffering Vermonters.

Legislators and Vermonters have no idea how much has been given away over the years.
No rational central accounting exists. The numbers are all spread over the place, likely on purpose. Nothing it properly vetted and exposed to the public. The state auditor, who loves renewable energy, likely knows about some of it, but apparently ignores it.

The renewable energy shenanigan factor is much bigger than the $200 million EB-5 fraud (the largest ever in the US), and $200 million healthcare website fiascos.

When recurring revenue gaps occur, legislators and bureaucrats pretend to have not a clue as to how that came about.

A unilateral carbon tax, $240 to $300 million per year, would further aggrandize state government, would raise the ante of foolish spending by about a factor of 3 to 4, and increase social discord.

Vermont unilateral carbon tax an economic headwind

Various renewable energy interests and lobbyists are going around the state to promote a unilateral carbon tax to save green businesses, because future federal subsidies will be decreasing.

The unilateral carbon tax would take $240 to $300 million out of people’s pockets and transfer it to the state government. A unilateral carbon tax would significantly increase the cost of gasoline and diesel for driving, and of fuel oil and propane for heating.

As part of various state programs, some people would get some money back as rebates, many others would get nothing back, or much less than paid in. For Vermont to impose a unilateral carbon tax would make its economy less competitive versus other states (i.e., more brain drain, more tax-paying households leaving the state and fewer good-paying, steady, full-time jobs, with good benefits in the private sector). A unilateral carbon tax would be another headwind for the anemic, near-zero, real-growth Vermont economy.

A unilateral carbon tax would further aggrandize Vermont’s government, which is too large, too inefficient, spending too much money, bloated with programs, and running annual deficits that are offset with annual increases of taxes, fees and surcharges, as if money grows on trees.

After six long years of out-of-control spending, Vermont finally has a governor who aims to reduce the bloated, wasteful state government to enable the anemic, hollowed-out private sector to start growing again.

Willem Post is a retired engineer who has more than 40 years of experience in the design and project management of energy systems. He writes about energy issues and is a founding member of the Coalition for Energy Solutions.

Images courtesy of Wikimedia Commons/Public domain and Flickr/401kcalculator.org
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2 thoughts on “Willem Post: Unilateral regressive carbon taxes a headwind for the Vermont economy

  1. In the financial sector it’s called ‘churning’. Buying and selling stocks, bonds and derivatives at an accelerated pace, not so as to create profits, but to increase commissions. Yes, the client makes a profit. But the administrators make a killing.

    In this case, the utility companies could care less about over-all efficiency. They’re fine with the ‘green’ movement’s propensity toward solar and wind power because, at 20+ cents per kwh, the utility’s regulated profit formulas allow them to make more money, even (especially) when the power they sell is inefficient.

  2. I’m always suspicious when I’m asked to pay a tax to the government so that they can pay me my own money back…

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