Tax the rich before they kill us all
A new OXFAM report finds that the richest 1% of the world’s population is responsible for as much carbon pollution as the poorest two-thirds of humanity.
This Instagram post from a couple of years ago caused enough embarrassment that it was taken down after 8.3 million views, but it could have been on the cover of the new Oxfam report Climate Equality: A Planet for the 99%. It starts with a stern Greta Thunberg writing in the forward:
“The richest 1% of the world’s population are responsible for as much carbon pollution as the people who make up the poorest two-thirds of humanity. They have stolen our planet’s resources to fuel their lavish lifestyles. A short trip on a private jet will produce more carbon than the average person emits all year. They are sacrificing us at the altar of their greed. This report reveals a perverse reality: those who have done the least to cause the climate crisis are the ones who are suffering the most. And those who have done the most will likely suffer the least.”
In my previous writing, I did not worry much about the 1%, with their production of 16% of carbon emissions, as I was about the top 10%, who are responsible for fully 50% of the carbon emissions. I thought the private jets and yachts of the super-rich were ostentatious and emitted a lot of carbon, with some very rich yacht owners at 3,000 tonnes per year when the Canadian average is around 18, but there weren’t that many of them- only 7,700 worldwide, with a total annual output of 1.7 gigatonnes of CO2, while the top 10% pumped out 18.5 gigatonnes. But many average North Americans are in that 10% and can find it hard to cut their footprint significantly; it costs serious money to change to electric cars or heat pumps. Many live in places where it’s hard to get around without a car. But as the report notes,
“Cutting emissions is easier the richer you are. The majority of carbon emissions of the super-rich come from luxury goods and services and from their investments, so they have far greater capacity to make the deep and immediate cuts we need to stay below 1.5°C. No one needs, for example, frequent air travel, private jets or yachts, multiple multimillion-dollar mansions or fleets of high-end gas-guzzling cars. With one call to their stockbroker, a billionaire investor can easily shift their money away from fossil fuels into green energy.”
I found when I wrote my book, Living the 1.5 Degree Lifestyle, that cutting out red meat and making little lifestyle changes was one thing, but the only reason I could actually pull it off and cut my carbon footprint so much was that I had the money to live in a walkable neighbourhood close to everything. I could e-bike everywhere, renovate my house into two apartments so that we were consuming half the utilities, and I had a cushy work-from-home job. It’s definitely easier when you have money. Richer people can afford big Passivhaus homes with Teslas in the driveway.
Oxfam wants to make the rich pay, calculating that a 60% tax on the income of the top 1% of earners (average income: US$310,000) would generate US$6.4 trillion per year that could be shipped south.
“Trillions of dollars of this new tax revenue must flow to the Global South to fund a rapid and just energy transition, support communities to protect themselves from climate change and to provide compensation for the loss and damage caused by climate breakdown. It must be used to cancel crippling debts, help rapidly reduce inequality, end poverty and deliver prosperity for all.”
They make the point that high taxes lead to greater economic equality, better public services, and “deliver high levels of well-being for less cost and far lower carbon impact.” Anyone who has been to Denmark (top tax rate: 55.9%) will see how well this works.
The economist Thomas Piketty tells the Guardian that the carbon inequality gap is a serious problem. “Poorly targeted policies on energy around the world place a greater burden on poor people, for whom energy, food and housing take up far larger shares of household budgets than for the well-off.” This is provoking a backlash, according to Piketty. He recalled the yellow vest protests in France, where people on low incomes were paying more for gasoline while the rich carried on as usual.
“Everybody now understands that everybody would have to make some effort [to cut emissions], it’s not going to be only the rich. But this effort has to be distributed in a way that can be accepted by the population. If you don’t address this, we are going to have a gigantic yellow vest movement everywhere. And that’s a little bit what we have.”
Indeed, we are seeing this in Canada right now. Perhaps our carbon tax should have been progressive, like our income tax. Piketty suggests a basic emissions allowance covering ordinary needs, “but activities beyond that – such as frequent holiday flights, large houses or large vehicles – would be taxed by larger increments, so that the most polluting activities were subject to “an enormous tax rate…You have to start right at the very top, [with] people who would take a private jet.”
Private jets piss everyone off since they are signs of extremely conspicuous consumption, and a very big portion of that giant carbon footprint of the very rich is from flying. Nothing will ever be done about them in Canada because Bombardier, which used to make streetcars and fast trains, got rid of everything except its private jet biz. Alberta is oil, and Quebec is Bombardier, and that’s why we are so fucked.
It’s not just Piketty. Jason Hickel, the degrowther and author of “Less is More,” complains about the “polluter elite” in the Guardian:
“We have to think about the rich in terms of how much they are depleting the remaining carbon budget. Right now, millionaires alone are on track to burn 72% of the remaining carbon budget for 1.5C. The purchasing power of the very rich needs to be curtailed. We are devoting huge amounts of energy to facilitate the excess consumption of the ruling class – in the midst of a climate emergency, that is totally irrational.”
But how do we deal with the 1%? They own the media, they own the government, and they control the discourse. Climate scientist Kevin Anderson describes the problem:
“The 1% group use their hugely disproportionate power to manipulate social aspirations and the narratives around climate change. These extend from highly funded programmes of lying and advertising to proposing pseudo-technical solutions, from the financialisation of carbon to labelling extreme any meaningful narrative that questions inequality and power. Such a dangerous framing is compounded by a typically supine media owned or controlled by the 1%. The tendrils of the 1% have twisted society into something deeply self-destructive.”
Yesterday morning, I watched a fascinating discussion on dealing with Canada’s energy transition, and closing the oil sands or Bombardier didn’t come up. Abatement, carbon capture and storage, small modular reactors, and even hydrogen did. After a week of reading the Guardian on the Great Carbon Divide, I really felt like I was on a different planet, or at least another country.
I have written previously that abatement and carbon capture are predatory delaying tactics to keep doing business as usual, and have written two books about reducing the emissions of the 10%. But OXFAM and Piketty make a good point: The 1%, the very rich, consume the most, emit the most, and are a juicy target.
And on this Black Friday, I also recommend Kate Soper on how Consumerism is the path to planetary ruin, but there are other ways to live.
This is the Pareto Distribution in action and it is a natural law. You can try many things to eliminate it, but you will never be successful. Its just part of life.
I agree that there are good charities funded and run by good people with good intentions that do good work.
What I would like to convince you of is the idea that charities and corporations are not good substitutes for well funded government. I also would like to convince you that we all should be lining up to pay our taxes and that the wealthy should be at the front of the line with the biggest cheque and doing the least grumbling. Let me try to lay out my case (in part-complex problems cannot be solved in a few paragraphs).
You mention the constant refrain from government officials about not having enough money to properly fund programs. I don't think that this should surprise us at all. Over and over again we elect, candidates who tells us most loudly and proudly that they will be the one to cut our taxes, to put more money in the hands of hard working families, to drain the swamp by cutting down government to the bare bones. We fall for this snake oil pitch every time and the result is the same every time, we get less for more. When tax reform does come it directed to primarily the benefit of corporations and those who already have the most. We get sold on ridiculous and repeatedly debunked trickle down economics or related BS as the rationalization for this approach and then claim to be shocked when it just continues to make things worse. Shame on them for sucking us in the first time but shame on us for falling for it over and over again. Its like we have absolutely zero long term memory. To make it worse, when we do on occasion elect someone with ideas that might really make a difference we run quickly back to the purveyors of the "taxes are bad" mantra as soon as we are reminded that the important stuff costs real money.
I don't want to harp on charities too much but I do want to point out that because of the nature of the tax structures that support them they have the effect of diverting significant amounts of money away from our government's available resources. I am not a heartless s.o.b. trying to demonize the charitable instincts of good people. I am simply arguing that they shouldn't be supported on the public's dime and at the expense of properly funding government.
More important than charities are corporations. Corporations are a legal fiction created to remove/limit the personal risk of individuals taking on business ventures. They are tools of private interest. They are by their design and law required to prioritize the bottom line of themselves over all other interests. They are sociopathic. Their interests are not the interests of the community at large. Their interests are only those of their owners despite any marketing propaganda they may spout to the contrary. They externalize all costs that they are not legally obliged to incur. That means: pay as little as possible, preferably nothing, for exploiting public resources (forests, minerals, water or any other resource of the broader community that we are now, agonizingly slowly, realizing are not infinite), pollute if it costs less than not polluting, pay workers as little as possible, download infrastructure costs to the broader community, AVOID PAYING TAXES,... ad infinitum. We have, through poor legal governance of their activities and through the tax system, allowed them the means to hold government (who's purpose is to protect the public interests) hostage to their personal interests and by doing so made them our de facto governors. (more accurately, the unelected people that own and run them).
Now, I can sense that you might want to counter me by pointing out that corporations create jobs, corporations do pay taxes, corporations can provide services more efficiently than government can, etc. There is some validity in these counterpoints to my position, in theory, but I argue that the current system is so badly tilted in favour of maximizing the much more narrow interests of a few that it needs deep structural reform (starting with the tax system, or perhaps better with the government lobbying system so that we might have some hope of actually getting somewhere with tax reform).
I had the opportunity during my working career to see close up how flawed our tax system is. It is a byzantine labyrinth designed to obfuscate. It attracts very smart people to the tax business because navigating it is a challenging intellectual exercise and very smart people tend to know where to find money. There is lot of money to be found in the tax code. Corporations employ armies of lawyers and accountants and lobbyists to, first, influence how the tax rules are structured to ensure that they start tilted in their favour, while at the same time engaging a huge marketing machine to convince us that they the world will end if they have to actually pay taxes, and, second, to exploit the weaknesses in those same systems to further tilt the playing field and divert truckload upon truckload of money away from our government and into the private hands of a very small minority. If you want to get a small, and frightening, glimpse into just how profoundly corporations manipulate government for their interests, spend some time following the career paths of the lawyers/accountants/lobbyists that work day and night for corporations to exploit tax law loopholes. The smart ones, the best of the best at their jobs are very same ones that wrote the rules while working for the government. They then go on to the private sector to make real money exploiting the "legal" loopholes they created. I challenge you to track down detailed descriptions of some of the tax shelters used by corporations and high net worth people to avoid paying tax and, in effect, download their costs to the community (charities play a role here by the way). These schemes employ a complex maze of deliberate deceptions hiding their true role and undermining the purpose and spirit of the tax system. And, because the system was rigged from the start, these schemes are arguably legal. Standing behind a thin veneer of legality they exploit the rules to their very limits and beyond which in turn requires the government to try to stop the bleeding by hiring their own army which in turn diverts tax revenue away from what it was designed to fund in the first instance.
None of what I have said denies that government sometimes goes off the rails and sticks its nose into places it shouldn't or that it sometimes funds boondoggles of dubious merit that wastes tax revenues. That reality does not imho support an argument for gutting government. Instead it supports an argument for all of us to stop abdicating our personal responsibility for the quality of government we elect. We need to stop sucking up the populist drivel and demanding more of our political leaders.
Make no mistake, populist leaders on either side of the political spectrum are dictators at heart. Anyone who cannot see the parallels between the language of populist leaders being elected around the world today and the horrors the world witnessed only a lifetime ago is in a very deep state of denial. I recommend reading a short book written by Benjamin Ferencz called Make it Count as a reminder of what ordinary people are capable of under the influence of populist leaders claiming to have the solution to all our problems and as a guide on how not to continue to fall victim to their siren call.
Getting back on track, health care, education, support for the young and elderly, and a host of other important social functions are simply too important to be left to the whim of the private sector and or charity. They may both have a supporting role to play in some limited cases but making them the main suppliers of important services to the public will simply widen the divide between the haves and have nots while accelerating the destruction of the planet that supports us all.
We need, during every election cycle, to work together as a community to ignore the partisan nonsense and dog whistle distractions that dominate and divide political discourse and the community and displace discussion of the really important issues. We need to stop letting ourselves be manipulated and divided into us and them warring factions operating in a constant state of blind rage from where we cannot make rational decisions in the best interests of the broader community. Then we can start to create a government and community that serves us, each and all, well, fairly, justly.
I think we are capable, as a community working together, of creating government that we can point to proudly. I think that we can create government that we support, even when it does something that we may not fully agree with at an individual level, because we know it has the interests of the entire community at heart and not just a select few. I have no expectation or delusion that we will find a place where we all agree on everything and live in idyllic harmony but I do think we are capable of much more and being much better humans and that we as individuals together with the governments we choose have an important role to play in getting there. We need to accept that we get the government we deserve and start, together, demanding better from those that stand up to serve and then to support strongly those that answer that call faithfully. We need to stop falling for the distractions that those who benefit most from weak government deliberately fuel. We need to stop screaming at each other and realize that we are all from the same tribe and sit down and work together to be better humans. It will be hard, multi-generational work but what better thing to we have to do with our time here.