VPIRG can’t defend its carbon tax plan

By Rob Roper

VPIRG Executive Director Paul Burns has an op-ed in Vermont Digger (and probably other Vermont papers). It’s disappointing that he offers nothing substantial to support the ESSEX carbon tax or to refute the Ethan Allen Institute’s arguments against the scheme. He’s insulting in calling us “nutty” and misleading when he says we are “on the payroll of the fossil fuel industry.” This is completely false. It is worth noting that many VPIRG donors and board members stand to financially benefit from a carbon tax that subsidizes their renewable electricity businesses and/or mandates that Vermonters buy their product.

Rob Roper

Rob Roper is the president of the Ethan Allen Institute.

Burns’ attempts to mislead don’t end with false claims about the Ethan Allen Institute; he misleads Vermonters about the ESSEX carbon tax. Burns says Vermonters “will collectively save a dollar on low-carbon electricity for every additional dollar they pay for polluting fossil fuels.” According to the plan, only 50 percent of the revenue raised would be used to generally reduce electric rates. So, for most Vermonters, this is a scheme that takes $10 from one pocket and puts $5 back into the other. It’s a rip off. The other half of the revenue would be divided between low income rebates (300 percent of poverty or less) and rural rebates for households earning less than $150,000. If you don’t fall into both of these categories — and most Vermonters don’t — you’re screwed under the ESSEX carbon tax.

Even if you are both rural and poor, in most cases you would still have to buy an electric vehicle, solar panels, an electric heat pump or some such thing in order to break even.

Burns says, “Further, the plan is revenue neutral — meaning there is no change in state government spending.” Not really. Yes, the money raised will be redistributed, but only what’s left after the state pockets the overhead for collecting and monitoring the tax. Given how complex this mechanism is, the cost is likely to be very high. The Auditor of Accounts, for example, is charged with conducting at least two audits of the program each year, which by itself will be very expensive.

And, here’s what the bill says regarding electric utilities: “(c) Rate recovery; other provider expenses. A Vermont retail electricity provider shall have the opportunity to recover in retail rates its necessary and reasonable expenses.” Yes, folks, under the ESSEX tax electric companies are authorized to raise your electric rates in order to cover the logistical costs of lowering your electric rates. They take out of one pocket what they put into the other. It’s a scam.

Burns says, “It’s true that the wealthiest and large corporations would pay their fair share as Vermont’s biggest polluters — while low- to moderate-income Vermonters would save money.” This is absolutely false. Ben & Jerry’s is one of Vermont’s wealthiest and largest corporations, and representatives of the company testified that the ice cream maker will net nearly $1 million in subsidies under the ESSEX carbon tax. That money will come from small, less wealthy businesses that rely on gasoline, diesel, and home heating fuel, such as contractors, landscapers, general stores, etc., who will end up paying more.

Of course, having the government force a bunch of small businesses to subsidize their electric bills is good for Ben & Jerry’s business, as Burns notes. But he is not telling the truth when he implies this is good for Vermont business in general. It’s not.

Burns says, “State government isn’t responsible for picking winners or losers.” But under the ESSEX carbon tax the state is picking electric-based businesses (like wealthy Ben & Jerry’s) to be winners, and businesses that rely on trucks, vans, gas ovens and stoves to be losers. Pretending otherwise is insulting people’s intelligence.

The Ethan Allen Institute is willing to have a civil, substantive and honest debate about the details of the ESSEX carbon tax. We are disappointed that Paul Burns and VPIRG are apparently not willing or able to engage on that level.

Rob Roper is president of the Ethan Allen Institute. Reprinted with permission from the Ethan Allen Institute Blog.

Image courtesy of Flickr/401kcalculator.org

10 thoughts on “VPIRG can’t defend its carbon tax plan

  1. A Pig in a poke ,this sure has the smell of one …………

    The Old Adage ” Buyer Beware ” good time to take heed !!

  2. The Essex plan and others like it…. Stealing money from hard working Vermonters (who drive to work and heat their homes) while redistributing SOME of the money to political cronies and likely democrat voters. Democrats want to place this burden on Vermonters while having NO measurable effect on climate change. I repeat, create a burden for working and elderly Vermonters and have NO measurable effect on climate change. Anyone supporting a carbon tax or anything like it should be vehemently opposed at the polls.

  3. Rob, Well spoken about the treachery of the ESSEX plan and regarding VPIRG”s Burn’s feeble and blatently dishonest support of it.

  4. Vermont Lagging Behind Other NE States: Vermont has been sliding backwards regarding economic growth, compared to other NE states during 2012-2016, because of various expensive follies, such as:

    – The huge adverse impact of all the state mandated, expensive, subsidized renewables
    – The state usurping dominance in centralizing control of education, instead of local control of education
    – Socialist-style experimenting with healthcare systems
    – Vermont having a bloated, inefficient government that suffocates the private sector.

    These follies have become an increasing headwind that further reduces the near-zero, real-growth of the anemic Vermont economy.

  5. Carbon Taxes, Subsidies and Cost Shifting:

    Senator Bray of Vermont does not get it. He announced he wants to eliminate the sales tax on the first $30,000 cost of buying an EV. 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 1) an $1800 saving for the upscale-income buyers, 2) the state having less revenue and 3) the state having bigger CHRONIC deficits, and 4) other taxpayers paying more. There is no free lunch, except in LaLaLand.

    Legislators like Bray have been giving away the store to please RE constituents for at least a decade.
    Did Vermont’s annual CO2 decrease due to all these RE 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 sponsoring carbon taxes likely have near-zero experience designing energy systems and the economic impacts of their mandates. About 25 Democrat legislators just get on the carbon tax bandwagon with their Essex Plan and rah-rah along.

    – Legislators and Vermonters have no idea how much has been given away in terms of tax credits, subsidies, accelerated write offs, surcharges and fees by various energy bills and mandates over the years.
    – No rational central accounting exists. The numbers are all spread over the place, likely on purpose.
    – Almost nothing it properly vetted and exposed to the public.
    – The state auditor likely knows about some of it, but apparently ignores it.

    The RE 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 – 4, and increase social discord.

  6. A wise person would advocate putting the horse before the car, i.e., 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.

    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; most folks would never qualify. 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 GMP’s expensive “islanding/microgrid” fantasy.

    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 RE press releases
    – Vote for Democrat/Progressive 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 PUC.
    EV, financed with an onerous, ever-increasing, $65 million surcharge on electric bills, is a perfect example of taxing the many and giving to the few who are “deserving”, i.e., willing to do things the expensive EV 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.

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