Who Pays?

Americans talk a lot about growing inequality, but we often fail to recognize how frequently poorer folks shoulder the costs of change simply because existing systems work that way. “The way things are” often translates into an unthinking acceptance of burdens that should—and could–be reallocated.

A recent column in the LA Times by Mark Schapiro  makes that case with numerous and telling examples.

Congress may continue to resist a carbon tax, but Schapiro points out that the American  middle and working classes are already paying for the costs of climate change. Those costs may not look like the much-disdained carbon tax, but if we are honest, they amount to one. Every time the average American uses fossil fuels, he increases his tax burden.

Schapiro counts the costs of recovering from Superstorm Sandy, Hurricane Katrina and a growing number of major droughts—the sorts of dramatic climate “incidents” that are likely to become much more frequent as climate change advances. And he details the economic consequences of changing weather patterns for all of us.

“Start with food: Farmers have always faced good years and bad years, but as bad years get more frequent, taxpayers pick up more and more of the tab. When the Government Accountability Office issued its biannual audit of the government’s highest financial risks last year, for the first time since the list was launched in 1990 climate change was identified as a major financial threat, specifically because of the government’s flood and crop insurance programs.”

Federally subsidized payouts for crop insurance have skyrocketed (from $4.3 billion in 2010 to $10.8 billion in 2011 and to $17.3 billion in 2012). Even more significantly, the USDA has estimated that the 2012 drought led to a 20% jump in meat prices. And the price of cereals has doubled since 2000, according to the U.N. Food and Agriculture Organization, again due to climate change.

Acidification of the oceans and rising sea levels (from melting ice packs and glaciers) have given us declining yields—and soaring costs—of shellfish.

The list goes on. And that’s just at the grocery.

Scientists writing in the journal Health Affairs report that “over the first nine years of this century, six “climate-related” events (floods, hurricanes, infectious disease outbreaks) led to 760,000 encounters with the healthcare system amounting to as much as $14 billion in health costs.”

Even that substantial sum is dwarfed by the millions spent by the CDC and other research institutions to study the ways in which climate change is enabling an ever-expanding universe of bacteria and diseases affecting humans, plants and animals in new and troubling ways.

There is much more, but the bottom line is that the general public–that’s you and me– bears the costs of climate change through both higher prices and higher taxes; meanwhile,  the fossil fuel companies contributing to the problem continue to enjoy massive subsidies.

The farmer who needs fuel for his combine, the factory worker who fills his tank for his commute to work, the soccer mom doing car pool duty—these are the people who are paying the tax that isn’t labeled a tax.

The major corporate producers of these fossil fuels continue to make unprecedented, outsize profits, thanks in large part to public policies that underwrite and subsidize fossil fuel exploration. Those energy policies exacerbate inequality by placing the costs of climate change and energy exploration almost entirely upon the consumer.

There are obviously much more important reasons for addressing climate change than the unfair allocation of costs—reasons of life and death. But those of us who advocate for responsible environmental policies also need to insure that the costs of necessary remedial measures are equitably distributed.

We need to take care that the burdens do not always fall on the most vulnerable–and in this case, at least, the least culpable—Americans.

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3 thoughts on “Who Pays?

  1. While we don’t often think this way, the real value of wealth is safety. Insulation from risk. Resources to protect ones resources.

    Climate change puts us all at risk. In some cases deadly risk, in others health risk, still others monetary risk.

    The fossil fuel industry has always been one creating vast wealth inequity. A short visit to Dubai, showed me almost unthinkably wealthy citizens of a country bequeathed the energy from past suns, watching mostly Pakistanis work in gut wrenching heat.

    The wealthy benefactors of our erstwhile energy bonanza would like their fortunes to grow unabated so that they can count on the protection of wealth from the consequences to all. They will not go quietly into that good night.

    We, who are unprotected from the climate wrath that can be prevented, are called by those not at risk, to continue to support the building of their castles. When danger comes, their hope is that we will be outside the drawbridge fighting for survival, while they inside, figure out ways to benefit from who- and what-ever survives.

    They have no need for government leadership, but to us it’s essential. Together, we can do what has to be done to mitigate the threat, adapt to the consequences or recover from the damages. That’s why so much money is being invested in tearing us apart.

    We, the people, must prevail.

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