By Guy Page
In response to yesterday’s report about Gov. Phil Scott’s seeming impotence to stop the Transportation & Climate Initiative carbon tax on gasoline, a reader said President Joe Biden’s energy policies have already created a de facto carbon tax.
This statement is true in one sense. Inaccurate in another.
“We effectively already have a TCI [multi-state scheme to tax gasoline and give proceeds to government for fossil-free projects] carbon tax as a result of Joe Biden’s inept energy policies,” Peter Yankowski wrote. “When Joe Biden was inaugurated on 1/20/21, the price of a barrel of West Texas intermediate oil was $53, today it’s $75 – an increase of 42%.
“This oil price increase is a de facto TCI tax that exacts damage to the US economy and all Vermonters, with more to come as Biden’s policies drive oil prices even higher.”
There’s no doubt that Joe Biden’s first major policy decision – cancellation of the Keystone pipeline construction permit – reduced domestic oil & gas supply. And when supply dwindles, demand rises. So does the price. Basic economics.
Fossil-fuel haters get this. They do fist-bumps every time the price of gas rises at the pump.
I know this because in 2007, I was selling advertising for the Lamoille County News & Citizen to a small solar power developer in Hyde Park. They were all small back then. As we sat in his kitchen, he laid out the renewable power industry business plan for me, plain and simple. The cost of oil had to through the roof. The consumer is king. Until government or God or some other almighty agent of change intervened on his behalf against the oil and nuclear power industry currently eating his lunch on price, he’d be forever on the energy market outside, looking in.
His prayers were answered. Peter Shumlin and the rest of the Legislature deep-sixed low-cost, low-carbon Vermont Yankee. In Vermont and abroad, the renewable power industry gained one subsidy after another. Alas, the invention of fracking dropped the price of oil. President Trump took the shackles off the oil and gas industry. It roared back. For a brief and shining moment the U.S.A. once again was the prosperous energy exporter to the world.
Oh, the horror.
But then Biden officially won the election. On his first day of office, minutes after sitting down to the Resolute desk in the Oval Office, he closed the Keystone spigot carrying almost a million barrels of crude oil every day from the Alberta, Canada oil fields. Then oil and gas producers, always vulnerable anyway to supply chain problems, struggled to meet post-lockdown demand.
Et voila – today’s average price for regular gasoline is $3.19/gallon, exactly a dollar higher than one year ago. (Vermont is $3.13 – in the middling range, with Texas the lowest at $2.82 and California the highest at $4.40.)
Like so many pandemic-related economic and policy outcomes, the rising cost of fossil fuels couldn’t have worked out better for the Democrats if they’d planned it that way. Which they did, kind of. While one might not be cynical enough to say the entire pandemic was planned, start to finish, to further the Democratic agenda, there is NO DOUBT that in Vermont, anyway, the leaders of the Vermont Legislature intentionally exploited the opportunity. It’s a matter of public record, all captured on Zoom.
The giveaway happened five hours, 18 minutes into the December 5, 2020 House Democratic Caucus meeting, held on Zoom and available on YouTube. The purpose of the caucus was to educate new lawmakers about how to move the Democratic legislative agenda. Williston representative-elect Erin Brady and veteran Springfield lawmaker Alice Emmons are reporting to the caucus about their small group’s discussion:
Brady: “We had a very similar discussion….the same idea of short-term recovery springboarding to long-term economic development plan. So many of these issues” – citing broadband, childcare, state colleges, natural resources protection, racial and social equity – “are not new issues or Covid issues but they are amplified by Covid….We have this opportunity that I think [Woodstock Rep.] Charlie Kimbell said you don’t let a crisis go by without taking advantage of the opportunity. What an opportunity we have right now for so many important policies.”
Emmons (to Brady): “You summed it up well. It was good. All the individual pieces that are listed there, the first step is dealing with Covid recovery and doing it in the context of a longterm economic recovery solutions act. Your medium and longterm involve all of these subsets of what we are dealing with with Covid. You set the foundation of that with the Covid recovery. Then over the years, you build on that.”
So back to Mr. Yankowski’s original point – yes, the Biden administration is advancing a de facto carbon tax. He’s gaming consumers to choose ‘cheaper’ alternatives to gasoline and heating oil. That’s been the goal of his renewable power industry supporters since at least my 2007 discussion in the solar power installer’s kitchen, and probably long before then.
But the rising cost of gasoline doesn’t do what gas taxes are supposed to do: separate motorists from their money and route it into the State’s bank account.
Instead, the State of Vermont taxes gasoline by the gallon (30 cents), not as a percentage of sales. When Vermonters buy a lot of gasoline, the Transportation Fund is flush. When we don’t, it’s not. Gas tax income declined 2.7% in August. Vermonters aren’t driving as much, thanks mostly to more people working from home.
Instead of rejoicing that the market has solved the Too Many Carbon-Emitting Commuters Conundrum and moving on to other more pressing or at least real problems, the State of Vermont instead is buying gift cards to pubs with state money and giving them to commuters who ‘green up’ their commute by walking, biking, carpooling, or public-transitting their way to and from work.
Confound that tax-by-the-gallon! My kingdom for a percentage of total sales! Riding that horse together, they could further inflate the cost of Vermonters’ freedom of movement and staying warm.
But our ‘representatives’ are stuck with a tax scheme that instead punishes them for our good behavior. It’s so unfair. What’s a cash-craving legislative majority to do?
We already know, because they’ve already done it: Pass the Global Warming Solutions Act (every Dem voting to override Scott’s veto) and thus empower the Vermont Climate Council to hitch us to the Transportation and Climate Initiative. That way, Vermonters get taxation without representation. Without the messy electoral consequences. It’s a beautiful thing!