You are here

When 'Being Green' Means Subsidies For Rich, Harm for Poor

Op-Eds & Articles

Title

When 'Being Green' Means Subsidies For Rich, Harm for Poor

One thing we can expect in President Obama's State of the Union speech is for him to echo his declaration from last month, "That's the very simple choice that's facing Congress right now. ... Are you willing to fight as hard for middle-class families as you do for those who are most fortunate?"

Yet when it comes to the environment, the president showers favors on the rich while punishing the poor.

During last year's Occupy Wall Street protests, Obama expressed sympathy with calls for more "green" policies from the self-styled advocates for the 99 percent. So far, however, the environmental agenda has overwhelmingly favored the 1 percent.

Consider the Obama administration's subsidies for electric vehicles. To start with, there is the $7,500 credit for the car itself. Add to that the recently expired $1,000 credit for installation of a 220-volt charger.

And on top of these, the government has thrown more than $3 billion at the Chevrolet Volt alone -- which totals out to $250,000 per vehicle. Not only do these credits go to corporate giants like General Motors, they subsidize cars for the wealthy.

The Volt sells for about $40,000, while the Fisker Karma sells for $100,000 -- well above most Americans' price range. That means that the federal government is again working to benefit the rich so they can drive cars that ease their environmental conscience.

And for what? If 6 million wealthy Americans buy these cars, as the president hopes, it will reduce oil consumption nationwide by less than 1 percent.

OK, so Obama's environmental policies are subsidizing the rich, but they're helping the poor, too, right? Wrong. In fact, nearly every environmental policy hurts the poor the most.

Last year, Americans spent more on gasoline as a percentage of their income than they have for 30 years. Yet that hasn't stopped the president, cheered on by his environmentalist allies, from rejecting the Keystone XL oil pipeline or restricting offshore oil permits.

The president's new commerce secretary, John Bryson -- a radical environmentalist who helped found the Natural Resources Defense Council -- has called for even higher energy prices.

In a 2008 panel discussion with New York Times columnist Thomas Friedman and Supreme Court Justice Stephen Breyer, Bryson said, "Take global warming. It's going to cost something to deal effectively with this. Energy prices are going to have to go up."

His comments seemed to have the intended effect on Justice Breyer, who responded, "We better get away from oil. ... Raise the price of oil! Raise it through the roof, and then people will look for substitutes, so I cheer."

It's easy for rich liberals to call for new government programs that increase prices, but it's the poor who bear the real burden. Consider the effect of California's Renewable Portfolio Standard, a major initiative that Bryson championed during his time in California.

California's RPS mandates that utilities use higher-cost renewable electricity, which acts like a hidden tax on electricity. This added cost forces prices upward, because electricity is a major component of every good or service. And the poor spend nearly all their income in a given year, so the RPS disproportionately hurts them.

Bryson understands hidden taxes, too. While speaking at the University of California at Berkley in 2010, Bryson praised President Obama's cap-and-trade energy bill as having "the advantage politically of sort of hiding the fact that you have a tax, but that's what you're trying to do, trying to raise prices of carbon."

Fortunately, cap and trade was defeated, but many other environmental policies -- bans on cheap light bulbs, air emission regulations, and others -- will continue to increase energy prices and harm the poor as long as they remain in effect.

The 1 percent devised these policies, but it's the 99 percent who are paying.