John Hood Column: Public won’t accept green taxes

Published 5:14 pm Wednesday, January 2, 2019

I know that environmental activists don’t want to hear this, but a core component of their preferred strategy for combatting global warming — substantially raising the price of fossil fuels through higher taxes — is not going to happen.
Whatever the public’s views may be about the causes and effects of climate change, most people don’t think gas prices and electric rates are too low. While modest price increases to cover higher production costs, or modestly higher taxes to fund road and bridge construction, may not provoke a massive backlash, the dramatic hikes in prices that environmental groups want to discourage the use of fossil fuels are just politically unsustainable.
Don’t take my word for it. Look at recent events in two left-leaning political constituencies: the state of Washington and the country of France.
In November, even as Washington Democrats were winning most of the competitive races in that state, 56 percent of Washington voters said no to a ballot proposition that would have imposed a carbon tax to combat global warming. The tax would have started at $15 a metric ton and then increased $2 a year until the state’s goals for greenhouse-gas emissions were met.
After a previous carbon-tax scheme failed in 2016, activists had retooled the plan to draw more support. The 2018 initiative exempted some key employers in Washington State, such as paper plants, to mute opposition from labor unions. It promised to spend the proceeds on renewable-energy projects to create jobs. And if the truth be told, as costly as the proposed tax would have been for Washington consumers, it was far lower than the price hike most scholars believe would be necessary truly to shift energy markets away from fossil fuels.
But Washington’s voters said no, anyway. They didn’t judge any environmental benefits that might flow from the carbon tax in the long run to be worth the cost, and they didn’t trust that the resulting revenue would have been spent effectively. The voters were right on both counts.
In France, the recent revolt against green taxes played out not in polling places but on the streets. The “yellow vest” movement began as opposition to higher “green taxes” on gasoline and diesel, with hundreds of thousands ultimately turning out in protests that produced widespread economic disruptions, political disaster for President Emmanuel Macron and his coalition, and even several tragic deaths. In response, Macron has walked back scheduled hikes in motor-fuels taxes and may soon be forced to go further than that.
It is important to understand that in neither case can the opposition be characterized as tea-party conservatives or climate-change skeptics. There aren’t enough such voters in Washington to have defeated the carbon tax multiple times. In France, the yellow-vest protestors are advancing a range of demands, including traditionally left-wing fare such as raising minimum wages and enhancing government pensions.
If activists can’t find the votes to jack up green taxes enough to matter in places such as Washington and France, you can be sure they will fall far short in North Carolina, where public opposition to tax increases of any kind is broader and deeper.
A few weeks ago, Gov. Roy Cooper announced a goal of reducing greenhouse-gas emissions in North Carolina 40 percent by the year 2025. Cooper’s target is quite a bit less than initially meets the eye, since the 40 percent reduction is from the 2005 baseline, not from 2018. Our emissions have already fallen by 25 percent since 2005, so Cooper’s real goal is an additional 15 percent.
While North Carolina has been tipping the scales heavily in favor of renewables, that’s not the main reason emissions have declined. Wind and solar remain a very small part of our energy mix. The big stories are gains in energy efficiency plus a large-scale replacement of coal-fired power plants with electricity from cleaner-burning natural gas.
Activists still dream of carbon taxes and a massive abandonment of fossil fuels. Once they awaken, a realistic conversation may be possible.

John Hood (@JohnHoodNC) is chairman of the John Locke Foundation and appears on “NC SPIN,” broadcast statewide Fridays at 7:30 p.m. and Sundays at 12:30 p.m. on UNC-TV.