Ming on the environment: tax hikes and waffle

On proper inspection, I fear I was a little over-generous on Ming’s statement on environmental policy yesterday. My point that Chris now needs to meet the challenge now that Ming has thrown down the gauntlet still stands, but the detail of this chapter is very disappointing.

First of all, if you are going to make an optimistic case for environmental policy and still oppose nuclear power, then don’t refer approvingly to James Lovelock in your second paragraph. I have a lot of time for Lovelock but his position these days is that we should have a fission reactor on every street corner and even if we do, we’re still fucked. Namechecking him suggests that you are just plucking names out of newspapers that people might recognise rather than demonstrating a depth of knowledge on the subject. There is nothing to be gained by positioning yourself near him.

Secondly, and rather more fundamentally, the overall analysis of this statement can be summed up by the phrase “win-win”. We can change behaviour simply by offering people incentives, and not have to get into that nasty business of charging people extra at all. This is away-with-the-fairies stuff.

If you want to introduce “incentives” for example, how are you going to pay for them if you aren’t prepared to raise environmental taxes? If this isn’t going to be raised through general taxation, what public services are you planning to cut? If the figures we are talking about are not significant enough to warrant further clarification, then how will they be effective?

It gets worse. Ming also signs up to road user charging, a big mistake as I have argued previously. What’s more, all the money raise by it would be put into “improving public transport alternatives”.

There are five reasons why this is a bad idea (I started with two, but got carried away). Firstly, we’ve been ploughing money into rail travel for the past decade, yet rail fares have increased. Why? Because monopolistic providers suck up public funding the way a sponge soaks up water. Local buses don’t need subsidies, they need passengers.

Secondly, this switch is all about taking money out of cities and ploughing them into subsidising rural communities. Congestion is, broadly, an urban problem. Lack of public transport alternatives is, broadly, a rural problem. What possible environmental or social reason is there for city dwellers to subisidise their country cousins in this way? If we all moved to the countryside, we’d have an environmental disaster!

Thirdly, it doesn’t tackle the primary thing we should be doing, which is reducing the need for travel. Providing a bus to out of town shopping centres is a less desirable solution than encouraging a local shopping centre. It is a fallacy to argue that we can solve environmental problems simply by greening up activity without looking at whether such activity is needed. “Pricing people out of their cars” creates the situation whereby such measures become desirable.

Fourthly, all road user charging does is make roads more economically efficient – it does little to reduce car use. So people will move goods at different times of day, or take alternative routes, so what? This has nothing to do with the environment, or even quality of life.

Fifthly, what about the civil liberty implications of noting down the movements of every single vehicle in the country? Why do this unless there is absolutely no alternative?

Ming also bigs up individual carbon accounts. Good, I certainly support the economics behind these, if not the specific proposal. But he goes and blows it all by adding the caveat “if the technology eventually allows.” Who gives a crap about the technology? We have the means to start implementing something approximating carbon accounts right now: just sell carbon rights to businesses, let them pass on the costs to their customers, and give each individual a share of the dividend.

As I’ve argued previously, environmentalists make a big mistake when they get caught up in solutions that demand technological perfection, when practical alternatives are available right now. As such, paying lip service to individual carbon accounts without talking specifically about what you propose to do in the here and now is a cop out, pure and simple.

In short, despite his exhortation that “we’ve had enough hot air and hand wringing,” I find little to fill me with confidence in this paper. What it pointedly lacks is the single, clear point that Chris Huhne has made again and again: we need a tax shift.

Simon Mollan has dismissed Chris’ environmental policies as “sackcloth wearing,” yet appears oblivious to the fact that every pound Chris proposes to raise through eco-taxes would be offset by a rise in personal allowance. This is tax cuts and a real incentive to change behaviour.

Before I get too carried away, I should make three points. Firstly, Jock Coats is absolutely correct to point out that this tax shift has got to include land. You simply can’t raise the neccessary amounts without doing so. Secondly, as I suggested above, I am in favour of some kind of “citizen’s dividend” – a per capita sharing out of a proportion of the revenues raised from eco-taxes (Friedmanites might prefer to call this a negative income tax). There are basic levels of heat and lighting that people should entitled to. Thirdly, with that in mind, I think the target for removing anyone on minimum wage out of income tax altogether should be an aspiration, not a strict target that we would neccessarily pledge to implement in a single term of office (although if people want to convince me otherwise, I’m all ears).

This isn’t, as Simon suggests, unpopularity for the sake of it. At the Meeting the Challenge conference a couple of weeks ago, Lord Rennard made the very important point that we should always have one high profile “unpopular” policy measure as it helps us win the argument that we are credible and not simply being all things to all people. Chris Huhne has consistently argued that this is a similar battle to the penny on income tax policy which we eventually won. On it’s own, of course it would be a reckless policy. As part of the wider agenda that Chris has put forward, it makes very good sense indeed.

Even though he has yet to flesh out his position as much as I feel he now needs to, Chris’ position is still more robust than Ming’s hodge-podge of half-hearted measures.


  1. I agree with all of that.

    I despaired on reading Ming’s statement. He manages to use ten times the words to produce a tenth of the substance Chris does.

  2. Your point 3 is spot on (reduce the need for travel). But I have great difficulty in believing 4 (road user pricing doesn’t reduce car use), and 1 (rail fares have increased solely because of “monopolistic providers”) is arrant nonsense.

    Rail fares have increased, and the rail industry is failing, because of structural weakness in the industry, and because of a complete failure of Government direction and (especially) regulation. Actually, a lot of why the railways are in such trouble can be summed up in the phrase “boiling frogs” (and occasionally “power-hungry lardbutts”), but you need to read Roger Ford at http://www.alycidon.com for more on that.

    Attributing the problems to ‘monopolies’ is the same mistake John Major and Steve Robson made when privatising the industry in the first place. Actually, there were 25 (!) different train operators after privatisation, four rolling stock leasing companies, and countless infrastructure contractors. Fat lot of good that did.

    Ming is right to say that money needs to be spent on improving public transport alternatives. The trick is to spend it wisely by accompanying it with significant structural reform.

  3. What’s the problem with raising the personal threshold for income tax very quickly? This can surely be done by slightly increasing income tax towards the top end.

  4. Richard,

    The 25 train operating companies were all monopolistic, or at best, duopolistic operations. They have all been given their own patch to do whatever they want.

    I hold by my claims that state subsidies are by their nature inflationary – we are seeing the same thing happening in the NHS. Spending more money is no substitute for reform, and cash handouts are no substitute for passengers.

  5. The ‘London-Scotland’ market still has two operators – GNER and Virgin. The lack of a monopoly hasn’t led to prices staying down here. Quite the opposite. These two have probably been the most rapacious in terms of fare increases.

    Agreed 100% that “spending more money is no substitute for reform”. But it is nothing, nothing to do with monopolies. British Rail was the ultimate monopoly, and was delivering a generally better railway at a fraction of today’s cost.

    There is no monopoly in rolling stock. Quite the opposite: there are three major leasers (Angel, HSBC, Porterbrook) and a handful of owners (including FirstGroup). So why do the leasers charge astronomical sums for a clapped out 1980s railbus, something so worthless that the last lot to come off lease here were actually shipped out to _Iran_?

    Maybe Ahmadinejad has travelled in one… that’s why he’s trying to nuke us. 😉

  6. Clearly environment is high up Chris Huhne’s agenda. First he sent me a letter, and enclosure, and another enclosure, in my capacity as a Councillor. Then he sent me another mailing letter, with different content, in another envelope, also with an enclosure – and in the same post was yet another letter from him (same content as before), with another enclosure and, YES, yet another enclosure. Three mailings in less than three days – all with must the same message on the environment. What a waste of time, energy and finite resources. And the consequence – I’m backing SIMON HUGHES not Chris Huhne to tell the truth about green issues!

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