Far too much centre-left discourse around climate change centres easy targets like polluting corporations, a green jobs revolution and international co-operation. But the bulk of emissions are attributed to individual consumption. Measures hitting most consumers, such as increased fuel taxes, are the best way to make a serious dent in our carbon contributions. We ought to champion them.
Going after corporations alone is not an alternative. Behind the lurid headlines about carbon corporate contributions are the consumer choices that drive them; one expert estimatesthat only a tenth of emissions is directly attributable to the often cited top 100 polluters. While corporations should shoulder the largest financial burden in the fight against climate change, measures with the primary goal of altering behaviour rather than raising revenue will have to hit most consumers.
There is a strong moral case to disincentivise the use of petrol and diesel cars. They are inefficient. They are a major contributor to air pollution. They are environmentally destructive. And for the last eight years, they have has been subsidised with an endless freeze on fuel taxes, currently to the tune of £9 billion every year. Faced with environmental collapse, a rapid rise in fuel tax is not just desirable, but a duty.
The fuel duty escalator has been frozen since 2010 by successive Conservative led governments in an increasingly expensive giveaway to motorists. It should be reinstated, and the lost ground made up. Supercharged to make to make up for lost ground over the last eight years, the escalator would stagger the economic shock of an immediate rise, and work as a long term incentivisation away from fossil-fuel travel.
For rural drivers without access to consistent public transport, fuel duty would not act as an incentive to alter behaviour, but as an unavoidable punitive measure. However for the majority, the evidence is that increasing fuel taxes does shift behaviour, more so than price fluctuations due to the higher media salience given to taxes. And many of the old objections to increased fuel tax; trapping people in welfare dependencythrough the inability to travel, penalising socialising, consumption and the like, are slowly being eroded by the growth of virtual interactions in these spheres.
Distributional impacts of fuel taxes vary from progressive to weakly regressive depending on development levels. In the UK the lowest income households have the lowest levels of car ownership, with 37.5% without access to cars in the lowest two quintiles, against an average of 15% in the top three incomes quintiles. A fuel duty rise would fall hardest onlower earning car-owners, but not on the poorest households overall.
Britain’s infrastructure is heavily tilted towards the use of cars, and this would be impossible to reverse. But a return to a continually increasing fuel tax gives a competitive edge to electric and hybrid motoring, and accelerating the gradual phasing out of the sale of new petrol and diesel cars, for which the government has already set the provisional date of 2040.
It will be harder to shift behaviour with the current state of British public transport. One solution might be a hypothecatedfunding increase. With the government spending around £6 billion per year on transport subsidies, the £9 billion lost by the freeze could represent a substantial increase in coverage. It’s been done successfully in the past, although with the fuel tax it might not prove sustainable. Fuel duty is self-defeating; as with all sin taxes the more successful the policy is in altering behaviour, the less revenue it raises for the Treasury. But the symbolic value might go some way to ameliorating public concerns.
Everything should be done to avoid plunging people into in work poverty, and the experience of Macron and his wealth tax cuts suggests that only a government committed to a broader distribution of wealth could push through these policies. Regardless raised fuel taxes will still be deeply unpopular. This should not stop it being adopted by parties professing to take environmental concerns seriously.
Real change to our climate trajectory means adopting bothspecific policies that will reduce the living standards of many, and blunt paternalistic interventions to disincentivise certain individual behaviours. This is anathema to the left, and to liberals. But the consequences of climate change demand some compromise with our own political beliefs.