Elitist Environmentalism Is Hardest On the Poor

Given that it is shaping up to be a colder than normal winter it is possible that climate change proponents will quiet down a little; however, I doubt it. The entire reason that they now use the phrase climate change instead of global warming is because the evidence for warming has become more questionable over the past fifteen years. While the terminology may have changed, one thing has stayed the same: most environmental policies advocated by environmentalists make things more expensive in a way that is regressive. That is, environmentalism is especially hard on the poor.

One big change this winter is that on January 1, the regular incandescent light bulb is disappearing. You will have to pay more upfront for a light bulb that will save you money on your electric bill. The EPA has proposed new rules on carbon pollution from power plants that will make it all but impossible to open a new coal-fired power plant in the U.S. except with very costly technology to capture the carbon emissions on the assumption that climate change is so serious a problem it is worth spending billions on right now. Tougher fuel standards for cars are being phased in. Ethanol and anti-ozone requirements for gasoline raise the price of gas and the price of food.

These changes make light bulbs more expensive, electricity more expensive, cars more expensive, gas more expensive, and food more expensive. The list could go on and on.

A recent paper by Aparna Mathur and Adele Morris published in Energy Policy tells the story on how regressive the carbon tax would be. One thing interesting about this paper is that the authors are truly bipartisan in the Washington, D.C. think tank world: Mathur is at the American Enterprise Institute and Morris at the The Brookings Institution. This, plus the academic peer review, lends the paper some serious credibility.

Mathur and Morris find that a $15/ton carbon tax would eat up 3.5 of the income from the bottom 1- percent of income earners, but only 0.6 percent of income from the top 10 percent (even though they consume more energy). That is extremely regressive.

What I find fascinating about these policies is that there are so many alternatives that could improve the environment without hurting the poor or even causing inflation. To the extent that the poor suffer disproportionally from environmental degradation (because they do not have the resources to avoid it), it seems especially cruel to implement pro-environmental policies in a manner that disproportionally impacts the poor financially.

Now, it is surely true that in many cases environmental improvement comes with a cost, but why do environmentalists seem to want to stress only that subset of policies? There are surely some win-win situations where we can do things smarter, cleaner, and cheaper (recycling and investments to reduce energy waste come to mind).

For example, instead of rewarding corn farmers in the Midwest with huge ethanol subsidies that do not even yield environmental improvements we could spend that money to convert public transit vehicles (and even many general government vehicles) to run on natural gas. That would provide cost savings (natural gas has become very inexpensive thanks to fracking) and environmental improvements because natural gas is a cleaner fuel than gasoline or diesel.

Rather than make energy so much more expensive here through excessive environmental regulation, we could get much more bang for the buck by spending some of our foreign aid budget on cleaning up power plants in China and India (just to pick two fast growing economies, there are plenty of countries that pollute). Environmental gains can be had for much less money in the developing world than in Europe or the U.S. Since climate change is a global, not a national problem, Europe and the U.S. would do more to reduce greenhouse gas emissions if they spent their money in other countries instead of at home.

If the money spent on annual emissions checks for cars (required in many of the nation's metro areas) was instead spent to get older, dirtier trucks off the road, we would save money and aggravation and produce greater environmental benefits.

Instead of investing billions of taxpayer dollars into green energy venture capital that has cost the taxpayer billions of losses, government could have invested that money into improving the efficiency of the nation's electricity transmission grids. About 7% of electricity that is generated is lost in transmission. Cutting this in half would allow for a substantial reduction in emissions, particularly because the reduced generation needed could all come from closing the dirtiest plants.

Instead of wasting billions on a failed stimulus package, we could have invested some of that money into smart traffic controls which let more traffic flow smoothly on our existing roadways. According to the Federal Highway Administration, every dollar invested in smarter traffic lights can save 20 gallons of gas. This is the ultimate win-win. We get environmental improvements thanks to less air pollution, drivers save time and money, and it is less expensive for local governments than building more roads.

This is certainly not an exhaustive list and I am not an expert on which ideas are the best for improving the environment in a cost-effective manner. However, if I can find a bunch of ideas that allow for environmental improvement without hurting the poor, experts should be able to do even better. That leaves us with the question of why environmentalists, who are supposedly experts, continually push policy options that raise prices for everyone and are often especially injurious economically for poor people.

The odd thing about this situation is that many environmentalists are also committed to reducing income inequality and on other issues fight for the poor and against the rich. In their zeal for the environment, they have lost sight of this other ideal. They need to pause for a moment and design a new policy agenda that can help the environment without doing it on the backs of the poor.