Letter to the editor: Barrett’s carbon tax is a bad idea

Editor’s note: This letter is in response to a Dec. 6, 2015 letter by Democratic Town Committee chair Gary Davis about the DTC’s endorsement of a bill proposed by Sen. Michael Barrett.

To the editor:

Lincoln’s state senator, Michael Barrett, has proposed a bill to impose a carbon tax to combat climate change. The tax will have no discernible effect on carbon emissions or climate change, but will substantially increase the cost of living and doing business in Massachusetts.

Sen. Barrett wants to impose a tax on all carbon fuels, regardless of who uses them. The tax begins at $10 per ton of CO2 equivalent in fuels, rising by $5 per year until it reaches $40 per ton. The price of gasoline would increase by 9¢ a gallon in the first year, and by 4.5¢ a gallon each year thereafter, reaching 36¢ a gallon in the final year. Natural-gas prices would rise 2% for each $5 increment, rising by 16% at $40 per ton of CO2. Homes and businesses that use propane, fuel oil, or carbon-generated electricity would see similar increases. Massachusetts already has the sixth-highest residential electrical rates in the nation. Sen. Barrett’s bill could make us Number One.

Sen. Barrett’s theory is that higher fuel costs will cause  people to burn less fuel, resulting in fewer miles driven, with homes and businesses colder in the winter, warmer in the summer, and more dimly lit year round, thereby reducing carbon emissions.

Sen. Barrett claims that this is not a “tax” because the money collected will be rebated to all residents and employers, after deduction of the bureaucratic costs of administering the program, and super-rebates to residents of rural areas and businesses that are adversely affected by high energy costs.

Sen. Barrett’s plan is fraught with problems.  I will enumerate a few.

• Administration of the tax will increase the size and cost of government, for both immediate salaries and benefits and long-term pension costs.
• Massachusetts is already a low carbon emitting state, so Sen. Barrett’s plan will have only a marginal impact on CO2 output and an undetectable effect on climate change.
• Most energy use is not discretionary. Homes and businesses must be heated and lit; cars and trucks must be driven. Sen. Barrett’s bill will raise the cost of doing that without materially reducing carbon use.
• If the tax decreases use of motor fuels, it will also decrease the taxes collected on those fuels, meaning that the fuel tax will have to be raised to maintain adequate revenue levels.
• Increased home heating costs will increase demand for fuel assistance in higher amounts and by more people. Qualification for fuel assistance also qualifies the homeowner for other benefits, such as weatherization services, heating system repairs, and discount utility rates, which are ultimately borne by all rate payers.
• Business profits are not immune to costs. Businesses that can do so will relocate to lower-cost states or import goods manufactured in those states. Sen. Barrett’s tax will have a devastating effect on energy-intensive businesses in  transportation, manufacturing, construction, and utilities, which are the biggest employers of blue-collar workers.
• Because lighting and heating costs are non-discretionary and necessary to every part of the economy, the tax will increase costs for all goods and services. Businesses that cannot relocate will pass the increased energy costs on to their customers. Landlords will pass the increased costs on to their tenants. Hospitals will pass their higher operating costs on to patients and insurers. College tuition will rise for the same reason. Taxes will rise because government is a big user of gasoline, fuel oil, and electricity. The MBTA will increase fares, decreasing public transit use and burdening those who must use it.
• Nearly one-third of Massachusetts residents use fuel oil as their primary heat source. Home heating fuel is not presently taxed. Sen. Barrett’s plan will have an especially cruel impact on residents who heat with oil because it has a higher CO2 content than natural gas or electricity, so will bear a higher carbon tax.

Sen. Barrett claims that these consequences will be mitigated by the requirement that all of the tax proceeds (less administrative costs and super-rebates to favored constituencies) will be rebated equally to every resident of the Commonwealth, and to employers based on the number of employees.  This plan has its own difficulties. Here are a few.

• Most basically, there is no master list of the residents of the Commonwealth. What would it cost to assemble one, understanding that it must be revised continuously to account for arrivals, departures, and deaths? How would the rebate be calculated for part-time residents, those who arrive or leave in mid-year, and newborns?
• Would the rebate be paid to illegal aliens, children, prisoners, and institutionalized persons?  Would it be paid to residents who owe taxes, alimony, or child support? Will residents who qualify for the Fuel Assistance Program get to double dip?
• The rebate to businesses, cities and towns, and other institutions is based on the number of their employees. The rebate to churches would not nearly cover their increased costs because they have large spaces to heat and light but few employees. Partnerships would get smaller rebates than other business entities because partners are not “employees.” Businesses that use independent contractors (e.g., taxi companies and delivery services) would get low rebates even though fuel costs will be high.

Does any reader of this letter want to drive less and pay more for the miles he or she does drive? Does any reader realistically believe that he or she can light his or her home or business less? Does any reader want to live in a home or work in an office that is colder in the winter and warmer in the summer? Sen. Barrett’s proposal to decrease carbon emissions will force all of this upon the residents and businesses of the Commonwealth, and still not achieve the goal of halting climate change to any measurable extent.

The bill will simply increase the cost of living and doing business in the state, and restore its reputation as Taxachusetts (no other state has a carbon tax). It is an example of feel-good policy making without regard to real world consequences. It is consoling to know that the bill will die because both Gov. Baker and Speaker DeLeo have promised no new taxes in this fiscal year. I urge every reader of this letter to contact Sen. Barrett and Rep. Stanley and say that you, too, oppose the new costs that would be imposed by Sen. Barrett’s bill, S.1747.

Sincerely,

Michael R. Coppock
214 Aspen Circle

Letters to the editor must be signed with the writer’s name and street address and sent via email to lincolnsquirrelnews@gmail.com. Letters must be about a Lincoln-specific topic, will be edited for punctuation, spelling, style, etc., and will be published at the discretion of the editor. Letters containing personal attacks, errors of fact or other inappropriate material will not be published.