Philosophy Discussion Forums | A Humans-Only Club for Open-Minded Discussion & Debate

[Robert66]

Why are they receiving subsidies at all? I have property and I give people places to live, but the government doesn't provide my business with any gifts.

Like Sy Borg, I have property in Australia. I would put my position like this: People pay me to live in my properties (in fact truth be known they pay the mortgage for me), and the government assists me greatly by way of allowable property-related tax deductions and the option to "negatively gear" my property investments should I wish to.

Sy Borg also writes: 'If they [subsidised fossil fuel companies] engage in poor business practices and fail to plan for the future, then they should suffer losses like everyone else.'

I would also characterise this situation differently. (A situation which I am appalled by, btw). Such a company, operating now in Australia, would necessarily include, in their plans for the future, their access to huge subsidies from the taxpayer. I would say that most companies with fossil fuel income streams are in fact also planning for a future without those streams, but taking advantage in the meantime of the extraordinary largesse of the real criminals.

[GE Morton]

Given what we've previously agreed about the justification of levying taxes for the protection of commons, as I've said I think the only possible disagreement here is a factual one as to the extent to which anthropogenic climate change really is a pressing problem. (Hence graphs of measured and modelled temperature rises and the like). If, for the sake of argument, we all agreed that it was then I think, (leaving details, semantics and political positions about other issues aside), we'd probably all be in broad agreement.

I agree that governments would be justified in imposing taxes to deal with climate change, provided those taxes were used to mitigate or otherwise address the problem, rather than to deliver more free lunches to various politicians' constituencies. For example, a carbon tax earmarked for building seawalls and levees, removing forest floor debris, relocating or reinforcing vulnerable roads and bridges, developing varieties of food crops tolerant of warmer temperatures, etc., might be justified. Those taxes would be paid, of course, by the users of those fuels.

OK. I presume the use of fuel taxes to fund highway maintenance would fit with the ideal that taxes are justified for the maintenance of a common resource from which all motorists benefit.

Yes. They were based on the premise that the users of the roads should pay for them.

I presume the question of whether the diversion of some of that tax revenue to subsidize urban transit systems fits that ideal depends on the question I mentioned above as to whether we believe that climate change is a pressing issue regarding the protection of a global common.

That is a rationale for the subsidies now being now being proffered, but it is contrived. Transit subsidies in the US were in place long before --- decades before --- climate change became an issue. Moreover, their contribution to that problem is minuscule, especially in relation to their costs. That is because public transit systems in the US carry less than 5% of daily commuters, a fraction that has steadily declined over the last two decades:

"Between 2008 and 2018, nationwide ridership declined by 6%. But if the New York City region is excluded, nationwide ridership declined by 9% over this period (Figure 1). Overall in 2018, there were about 600 million fewer transit trips taken than in 2008. This decline in ridership occurred at the same time the U.S. population grew by about 23 million people, from 304 million in 2008 to 327 million in 2018."

https://www.everycrsreport.com/reports/IN11181.html

Yet, despite falling ridership, local transit systems continue to add routes, purchase (with government grants) more and bigger and fancier coaches, and hire more union workers to drive their empty buses around town. Even worse, far from being eco-friendly, transit systems consume more BTUs per passenger pile than private autos (because of the low ridership).

https://www.cato.org/policy-analysis/tr ... n-parasite

[GE Morton]

Oops, last sentence should be "passenger mile," not "passenger pile."

[GE Morton]

Why are they receiving subsidies at all? I have property and I give people places to live, but the government doesn't provide my business with any gifts.

The state and federal governments in Oz don't allow you to claim depreciation on those properties, or deductions for maintenance costs, advertising costs, wages paid to employees, interest on the mortgages, etc.?

[Sy Borg]

Why are they receiving subsidies at all? I have property and I give people places to live, but the government doesn't provide my business with any gifts.

The state and federal governments in Oz don't allow you to claim depreciation on those properties, or deductions for maintenance costs, advertising costs, wages paid to employees, interest on the mortgages, etc.?

They don't come close to the taxes paid and there's no negative gearing. It's not comparable, especially since all of those tax breaks - and much more - are available to fossil fuel corporations.

No free handouts just for being a landlady, while fossil fuel companies receive taxpayer handouts for purely political reasons. If they can't make a profit without taking billions in free money from taxpayers, then they need to improve their business models.

[Steve3007]

Why are they receiving subsidies at all?

Well, the discussion seems to be about whether they are actually receiving subsidies or not. As I said in my post in which I cited a Guardian article and the WTO and IEA definitions of "subsidy", it seems to depend on which definition you use. As I said to GE, it seems that the WTO definition includes "tax revenue forgone" as one thing that it defines as a subsidy. So, as I said there, according that definition, it seems that any deviation from normal tax policy in a given country could be counted as a subsidy. For example, the UK government's decision not to increase fuel taxes in a given year, when there is an established policy of doing so, could be seen as a form of subsidy in that particular jurisdiction, even though fuel taxes there are already relatively high.

Anyway, if we're talking generally about the phenomenon of large multinational companies and rich individuals using their resources (lawyers, accountants and ability to base themselves for tax purposes in low tax jurisdictions) to minimize their tax liabilities in ways that most smaller companies and individuals can't, that's not specifically an environmental issue. It's a broader issue about the way that the international economy and taxation works. It's a fundamental issue about money and power that has existed since long before any concerns about climate change, perhaps summarized by the old joke that a bank is a place that will lend you money as long as you can show that you don't need it.

No, by the time I pay land tax on top of income tax and GST, it's about 50% tax some years, and that side is getting worse.

I googled GST and found that it's the thing that we call VAT and that I think in the US they just call sales tax? VAT on most things here is 20% (it's gradually risen over the years), but it's lower on some things. For example, it's zero on things like kids' clothes (which is handy for small adults) and it's only 5% on domestic gas and electricity for heating and lighting. Some would say that this lower value of 5% on gas for heating is part of the subsidy for fossil fuels. Some would say it should be increased and that taxes on motor fuels should also be increased. But that kind of thing is electorally unpopular. In the US they've had to release some of their strategic oil reserves into the market (in coordination with other countries) to try to bring down the soaring price of oil, reduce the cost of gasoline, and try to rescue Biden's poll numbers in time for the midterms next year. (It hasn't worked because they haven't released enough.)

How can you give them money to cover research into "clean coal" when they have had decades to work on pollution mitigation and did precious little, despite being given billions every year? That's akin to the government giving me the money needed to fix a property after a fire audit.

I haven't looked into that so don't know the details of the sense in which governments give companies money to research "clean coal". Maybe you could view it as analogous to government grants which pay for people to have their lofts insulated to reduce the amount of heating required (and therefore reduce the use of fossil fuels). We have that here. Although there have recently been protests by groups who want it to be done more (I think they want more taxpayer funded insulation in social housing), which have involved things like gluing themselves to roads.

[Steve3007]

I agree that governments would be justified in imposing taxes to deal with climate change, provided those taxes were used to mitigate or otherwise address the problem, rather than to deliver more free lunches to various politicians' constituencies. For example, a carbon tax earmarked for building seawalls and levees, removing forest floor debris, relocating or reinforcing vulnerable roads and bridges, developing varieties of food crops tolerant of warmer temperatures, etc., might be justified.

Yes, that would be the position that is inline with libertarian principles so I would expect it to be the line that you take. But it would mean using taxes only to mitigate the effects of climate change once they have happened. If taxes were used to encourage the production and consumption of low/zero carbon fuels and discourage the production and consumption of fossil fuels, wouldn't that be justified under libertarian principles? If we accept that anthropogenic climate change is an urgent problem (which is a separate question that you've asked in other topics, so let's park that for now) and if we regard keeping the atmosphere from warming by more than some particular amount as the protection of a common, then surely the libertarian would allow that kind of use of targeted taxation?

We all know that oil is a very convenient, very energy dense, easily extracted, transported and stored form of fuel. If climate considerations weren't an issue it'd be unequivocally great stuff. Black gold. Texas tea. So it seems reasonable to suppose that in a free market producers will continue to extract it because consumers will continue to demand it. In a free market, with no pressure from legislation or taxation, it seems reasonable to assume that the switch to other fuels wouldn't happen until the oil is depleted enough to be much more expensive to extract (such that other fuels would start to be more attractive). If we regarded that switch as necessary in order to protect a global common, then would it be acceptable to use legislation and taxation to tip the market (slope the "playing field") in its favour?

Those taxes would be paid, of course, by the users of those fuels.

As you've noted before, in a competitive market, whether we regard the taxes as being paid by the producers or consumers is irrelevant. If applied to all players in that market it acts simply as a "frictional force" that applies to all.

[Steve3007]

On that last point: Suppose, as an example, we consider a tax on the sale of gasoline. That's a tax on the process of trading that product. That process involves both a buyer and a seller. Being a tax on that process, it doesn't make sense to see it just as a tax on the consumer or just as a tax on the producer. The consumer and producer are inseparable. Neither can exist without the other. The same would go for any other tax.

That's another reason why I see this whole issue of blame (i.e. whether we blame the producer or the consumer) as irrelevant. To me, all that's relevant is whether there's a problem and, if so, which actions are most likely to help fix it. I see producers and consumers as, essentially, machines reacting to forces applied to them. I am both a producer and a consumer of oil. I'm a producer in the sense that (via pension funds if nothing else) I part-own oil companies. I'm a consumer in the sense that I eat food, drive to work, etc. In both those roles I'm a machine reacting to market forces. In my role as a voter I try (in my small way) to tinker with the forces applied to the machine-me to nudge it in what the voter-me regards as a beneficial long-term direction.

[Pattern-chaser]

I would also ban advertising of SUVs...

Me too; in fact I would ban SUVs. And I would also forbid any powered transport to be labelled "e-", "eco-" or "green". No form of powered transport is good for the environment. Some are less bad than others, but all of them do damage. To use these words to describe powered transport is wrong, literally and ethically. It is the archetype of 'greenwashing', isn't it?

[Steve3007]

Me too; in fact I would ban SUVs. And I would also forbid any powered transport to be labelled "e-", "eco-" or "green". No form of powered transport is good for the environment. Some are less bad than others, but all of them do damage. To use these words to describe powered transport is wrong, literally and ethically. It is the archetype of 'greenwashing', isn't it?

Going back to a question I asked previously, do you think there's anything to be said for compromise? The main reason I ask is that when we're considering what we might do if we had the power to do it, we often talk as if we had god-like powers to decree what shall and shall not happen. But nobody has those powers. Not even a prime minister or president. Everybody has to work by persuading others, one way or another. Decreeing that we're going to ban this or ban that doesn't do any good if the response of the world to our decrees is to kick us out of office. If that happens we don't have the power to ban anything.

So if, for the sake of argument, a policy of banning all SUVs resulted in not banning any SUVs, or doing anything else, (because it resulted in us being kicked out of office), whereas some lesser more gradual proposal didn't result in us getting kicked out of office, wouldn't the lesser/more gradual policy be preferable to us?

Softly softly catchy monkey?

[Pattern-chaser]

Me too; in fact I would ban SUVs. And I would also forbid any powered transport to be labelled "e-", "eco-" or "green". No form of powered transport is good for the environment. Some are less bad than others, but all of them do damage. To use these words to describe powered transport is wrong, literally and ethically. It is the archetype of 'greenwashing', isn't it?

Going back to a question I asked previously, do you think there's anything to be said for compromise? The main reason I ask is that when we're considering what we might do if we had the power to do it, we often talk as if we had god-like powers to decree what shall and shall not happen. But nobody has those powers. Not even a prime minister or president. Everybody has to work by persuading others, one way or another. Decreeing that we're going to ban this or ban that doesn't do any good if the response of the world to our decrees is to kick us out of office. If that happens we don't have the power to ban anything.

So if, for the sake of argument, a policy of banning all SUVs resulted in not banning any SUVs, or doing anything else, (because it resulted in us being kicked out of office), whereas some lesser more gradual proposal didn't result in us getting kicked out of office, wouldn't the lesser/more gradual policy be preferable to us?

Softly softly catchy monkey?

Your points are good ones, well made. My approach starts from a different premise, though. If we accept, as I do, that Climate Change (and all the other environment-related issues) threatens the very existence of our species, other priorities fade in comparison. I think we should, however unwillingly, consider an authoritarian approach, whereby measures are taken and all are forced (in one sense or another) to comply. This last sentence worries me; it goes against many of the values that I hold sacred. But perhaps the threat to our existence justifies this? Like any reasonable and decent person, what I'm saying worries me. It establishes all kinds of precedents that we would prefer not to establish, and so on. But what choice do we have?

Should we allow ourselves and our species to end because we can't agree to do something about it? Does that over-rule the compromise approach you suggest?

[Steve3007]

Your points are good ones, well made. My approach starts from a different premise, though. If we accept, as I do, that Climate Change (and all the other environment-related issues) threatens the very existence of our species, other priorities fade in comparison. I think we should, however unwillingly, consider an authoritarian approach, whereby measures are taken and all are forced (in one sense or another) to comply. This last sentence worries me; it goes against many of the values that I hold sacred. But perhaps the threat to our existence justifies this? Like any reasonable and decent person, what I'm saying worries me. It establishes all kinds of precedents that we would prefer not to establish, and so on. But what choice do we have?

If I did start from your position (that Climate Change threatens the very existence of our species) then I would agree that other priorities would fade in comparison. But that wouldn't alter anything I've said. When I said we have to work by persuading others I wasn't just talking about democracies. It's true of dictatorships too. As I said, the only entities for which it isn't true are those with god-like powers. Humans have to get things done which they think need doing by getting others to do them.

So if you think the problem is serious enough that force and dictatorship is needed, fine. But saying that doesn't achieve it. Saying "I hereby decide that CC is serious enough that democracy is now abolished and everything I say needs to be done shall be done, regardless of the hardships it causes" is just words. It doesn't mean it's going to happen. And, of course, it won't happen.

Should we allow ourselves and our species to end because we can't agree to do something about it? Does that over-rule the compromise approach you suggest?

No, if it's true, I think it shows that the compromise approach is the only useful option, because the other option (the kinds of decrees and authoritarianism suggested) amount to doing nothing at all. If it's a choice between compromise/persuasion versus no action at all, I'd choose the former.

[Steve3007]

Incidentally, in my view, a flat out ban on everything deemed to be an SUV wouldn't work for all kinds of reasons. Apart from anything else, banning on that basis takes no account of the actual amount of CO₂ emitted per mile. I'd prefer to base my policies on that much more relevant parameter. And rather than bans, if I think this is necessary, I'd prefer to use graduated and incrementally introduced financial incentives through the tax system. In the UK, that means varying the amount of "road tax" due depending on CO₂ emitted per mile, and taxing petrol. I'd also prefer to do it in such a way that it continues to get done and doesn't get abandoned by my rebellious subjects once they've overthrown me.

[GE Morton]

Yes, that would be the position that is inline with libertarian principles so I would expect it to be the line that you take. But it would mean using taxes only to mitigate the effects of climate change once they have happened. If taxes were used to encourage the production and consumption of low/zero carbon fuels and discourage the production and consumption of fossil fuels, wouldn't that be justified under libertarian principles?

Any tax on carbon fuels will have that effect, automatically. And, yes, it would be justified on libertarian principles.

In a free market, with no pressure from legislation or taxation, it seems reasonable to assume that the switch to other fuels wouldn't happen until the oil is depleted enough to be much more expensive to extract (such that other fuels would start to be more attractive). If we regarded that switch as necessary in order to protect a global common, then would it be acceptable to use legislation and taxation to tip the market (slope the "playing field") in its favour?

Yes. Again, a carbon tax would have that effect.

Those incentives should not take the form of advance grants to producers of "green" alternatives, however, since that invites political favoritism, padded R&D budgets, and frivolous "research." Tax credits awarded after a product has been produced, is market-ready, and meets specific targets (such as higher density storage batteries) would be preferable.

As you've noted before, in a competitive market, whether we regard the taxes as being paid by the producers or consumers is irrelevant. If applied to all players in that market it acts simply as a "frictional force" that applies to all.

All businesses taxes are ultimately paid by consumers. But levying them directly on consumers, rather than having them hidden in the price of the product, allows them to see exactly what their choices are costing them.

[Pattern-chaser]

So if you think the problem is serious enough that force and dictatorship is needed, fine. But saying that doesn't achieve it. Saying "I hereby decide that CC is serious enough that democracy is now abolished and everything I say needs to be done shall be done, regardless of the hardships it causes" is just words. It doesn't mean it's going to happen. And, of course, it won't happen.

In that case, how can we survive our own inability to act? Compromise will deliver far too little, far too late. [Note that I don't argue with what you say, only with its consequences.]