Flashpoint of Rebellion

The fact that the Gilet Jaunes protests were sparked by a fuel tax – an important part of Macron’s climate policy – has been downplayed by mainstream media analyses. A New York Times analysis of the largely rural dissatisfaction hardly mentioned the tax, and even analyses by Bloomberg go out of their way to wonder whether voters will turn to the hard right or the hard left come election time – a questionable supposition given protestors’ widespread rejection of electoral politics. To a certain extent, the importance of climate policy has also been de-emphasized by the “Yellow Vests” themselves, at least to the extent that protestors have claimed they will not remove the barricades even now that Macron has pulled the plug on the tax. Increasingly – and I have no reason to doubt its accuracy–the protests are seen as an assault on Europe’s liberal order itself – a referendum on technocratic, elitist and urban-focused policies for which Macron is seen as the natural heir now that Angela Merkel has said she will not seek re-election.

In fact it seems like a pretty straight forward carbon pricing approach could have obviated Macron’s problems, but I’ll get to that in a minute.

Contrast France’s political crisis with the bold rhetoric of Alexandria Ocasio-Cortez’s Green New Deal. The incoming Congresswoman is bidding to galvanize progressives by emphasizing a program of national economic and environmental justice. More than public speeches, she has published draft text for establishing a select committee in the House for this purpose before taking office and only a month after winning her election. Climate policy – in this case the failed climate policies of Republicans and centrist Democrats alike – is as much a flash point for political organizing as in France. The fact that both are being billed as revolutionary should hardly be lost on centrist parties that hold fast to a vision of global order in which economic liberalism and technocratic administration conspire in the progressive impoverishment of working people. Les Gilet Jaunes and Ocasio-Cortez are both highly aware that most people can’t afford climate change policies on offer today.

Cushioning the Blow

There are lessons to be learned from the French debacle, but they can’t be limited to finding a softer glove for the fist of the state. A New York Times piece on this point argues “France’s cancellation of the tax increase this week in the aftermath of increasingly violent protests signaled the perils and political headwinds that governments worldwide may face as they try to wean their citizens from fossil fuels.” The infantilizing metaphor of weaning the populace from energy use is all too telling.

The proposals in the NY Times article include bland options like trying to better distribute the burden away from rural areas where people have few transportation options, or ensuring tax revenues are better spent on climate sensitive alternatives. “What France’s experience has made clear, analysts say, is that fuel taxes work best as part of a more comprehensive plan that tries to offset the disproportionate pain felt by lower-income workers who can least afford the changes.”

Personally I doubt that cushioning the blow is going to do the trick. The imposition of consumption-based carbon pricing inevitably comes up against the hard fact that, by and large, many people have little choice over their use of fossil fuels. Moreover, this is a built-in feature of class relations. As a rule, as a matter of daily consumption choices, many people have direct say over energy use in two main respects: disposable income for discretionary purposes such as recreation or entertainment, and in decisions for larger purchases such as cars, home improvement, appliances, and so forth. Beyond that, for most working people the efficiency gains from marginal changes like adjusting the thermostat or limiting automobile use don’t seem worth the political cost. The only thing they do is make a difficult life less sufferable.

The idea of using revenue for investing in infrastructure or energy projects that will take years – if ever – to help people out seems pretty obtuse. Are you really going to tell folks living in small towns to take the bus rather than drive? Don’t get me wrong, I’ve lived in small towns and rural bus routes are life-savers for many, many people. But people are pressed for time as much as cash, and the fact is these policies, even when they make sense in the long term, place the immediate burden on the wrong people.

After all, a nominal fuel tax no doubt will have virtually no effect on the behavior of the wealthiest – I mean the largest – polluters. One could even surmise that a flat tax will never appreciably reduce emissions, for the simple reason that those who are income strapped have little choice and for most of those who are flush it makes little difference. The number of folks for whom 6 cents a gallon is the deciding factor must be fleetingly small. To think that a velvet glove approach will work belittles the intelligence of those expected to submit to the policy.

No New Taxes

A fee and dividend approach would have made a world of difference for Macron. If you want a populist measure for populist times, brand your carbon pricing well. No new taxes. Take from the big polluters to bolster the income of the working class. Price carbon, but return all the money to the people.

On the eve of California’s Global Climate Action Summit earlier this year,  number of prominent fiscal conservatives associated with the Climate Leadership Council released a major report that was virtually ignored. George Shultz, Larry Summers, Christine Todd Whitman – you can hear the progressives moaning – even Trent Lott have co-authored a white paper arguing for the fee and dividend model of carbon pricing. This form of pricing has been advanced by the likes of Exxon-Mobile, while similar proposals have been championed by Sentators Maria Cantwell and Lisa Murkowski.

It has also long been a central prerogative of climate justice activists – think Naomi Klein – on the far left of the American political spectrum. No wonder these proposals keep getting ignored.

A fee and dividend model puts a price on carbon emissions, but instead of collecting that money as tax revenue, it returns it outright to resident tax payers and dependents as an even payout. Those who pollute more, pay more. Those who pollute less get a nice check every month.

Administratively it’s comparatively easy because everyone gets the same amount. Got four kids and take the bus everywhere? Nice.

Add to that a rebate model that supports people who are structurally disadvantaged (think cost of living emissions like basic transportation, housing or heating), and buoy efficiency improvements for upgrades and major purchases so people will actually think it’s reasonable to replace their fuel oil boiler with natural gas or buy a smaller car.

Furthermore, it’s important to price carbon emission upstream so that the policy doesn’t feel so stingy – or so personal. If you put a fuel price at the pump, it hurts me. If you tax it at the refining process then the costs are distributed through the economy, and it ceases to be a kind of moral judgment on people who need to drive.

After all, corporate actors are in a far better position to come up with climate solutions than most people who are structurally in the position of accepting the limited array of options presented to them.

Is it possible that Gilet Jaunes, Alexandria Ocasio-Cortez and Larry Summers could share something in common? There is only one way to find out.