Brownlee’s latest emission


This blog is intended to be read whilst listening to the below song.  The above picture made sense in my head, if nowhere else.

Generally speaking, I think it’s a pretty good idea to internalise externalities, by taxing activities and products that impose a social or environmental cost on the rest of the world, and subsidising those that deliver a social or environmental benefit.  So I support petrol taxes, mostly as a way to off-set the environmental damages of burning oil (particularly if the tax income is used for that purpose), and as a way of bringing the price of petrol as close as possible to the real cost (personal, social, environmental; past, present, future).  This will hopefully reduce the use of petrol, as people who have to pay for the full consequences of their transport choices will be more likely to use public transport, cycle, carpool, etc.

So the latest petrol tax increase may have some accidental environmental benefits.  Emphasis on ‘accidental’, because Gerry Brownlee doesn’t mention it in his announcement.   He openly admits what Julie Anne Genter from the Greens exposed last month; that this tax rise is primarily about covering the $1.7 billion short-fall for the so-called “Roads of National Significance” plan.  This is why the Greens oppose this tax increase; it’s not about reducing petrol use, but encouraging petrol use by sinking $14 billion dollars into un-needed, uneconomical highways.

Brownlee probably knows better than to spin this as an environmental measure, because it would illustrate a stark double standard: it would be the opposite of their stance towards business and agriculture.  For these other major polluters (and National’s main backers), they’ve shown compassion in these tough economic times, and given them longer before they have to start paying for the social and environmental costs of their emissions.  The taxpayer can pick up the tab for a bit longer.

There’s another double-standard whereby this government, who “want to cut taxes, not raise taxes” according to the John Key quote in the above Home Brew song, are relatively trigger-happy when it comes to increasing GST and other sales taxes.  Some of these do off-set (or over-compensate for) external costs of harmful substances.  But if they’re just income-gathering measures like in this case, it’s worrying that they’d rather earn income this way than by putting income tax back up, or by introducing capital gains or financial transactions taxes.  Sales taxes tend to be regressive; disproportionately hitting the poor, while the latter are progressive; disproportionately hitting those with disproportionately high incomes and wealth.

IrishBill at The Standard points out another double standard, particularly pertinent to Brownlee; they’re happy to levy the ordinary motorist to pay for their idiotic motorway plans, but they’re not willing to implement a temporary, progressive levy for the Christchurch rebuild (because of the fragile economic climate, of course… not because of their priorities, choices and philosophies).

Actually, all of these double standards reveal a lot about the political philosophy underlying this government… Ordinary people are able to tighten their belts, while the rich need financial assistance.  We all have to make sacrifices, apparently, but on a religious level, these are sacrifices to the gods of the neo-liberal market capitalism, and on a material level, they’re sacrifices to the rich.  “Socialism for the rich, capitalism for the poor” indeed.


  1. Jenny

    Odd that the Greens should oppose this tax. Which as you say moves the price of petrol some way to its real cost.

    I understand that this is being done because the Green Party (and Labour) have expressed justified dismay at the roads of national insignificance which will waste $billions serving only the interests of the powerful roading and fossil fuel lobbies.

    However wouldn’t it be better for the Greens to, as well as exposing the causes of this increase, argue instead for the funds raised, to be switched to public transport initiatives?

    In opposing this tax are the Greens giving in to the same sort of popularism that drove their decision to play down climate change?


    • calebmorgan

      Maybe… perhaps they feel like it’s better long-term strategy at the moment for them to score points against National than to build bridges by saying that in some ways they could support petrol tax rises if this, this and this were different.

      Or perhaps they feel that even if it does have accidental environmental benefits, they can’t support this tax increase in and of itself, but would support a broader change in taxes and regulations which may include increasing petrol sales taxes somewhere along the way, but it would also include making wages, incomes and other taxes fairer so the regressive effects of sales taxes are lessened, strengthening public transport and fuel alternatives to give decent affordable alternatives to driving, and taxing business, agriculture and the rich for their emissions rather than just motorists. (I’m basically just saying my opinion rather than the Greens’, but i know that they do support this stuff to some extent).


  2. Pingback: Now the politicians are struggling too? « Cut Your Hair

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