about the “Entergy” tax - Part Four
July 17th, 2007
Politics, Vermont, critical thinking, economics, global warming, taxes
Well?
Hopefully this simple change of perspective – even though hypothetical – provided a different way to think about the Entergy tax. The $30 million dollar windfall now can be thought of as a “dividend” to the Vermont “stockholder”. Each resident would see an additional $50 in “profit”. What to do with that profit? Offset the higher energy costs of the previous year? Use it to buy some more insulation? Nope. The state says give it to their “new” energy initiative so we can reduce our carbon footprint. Well, this may be fine for some of us. What’s another $50 out of our pocket? (Are you thinking - but it’s NOT Vermonter’s money? then you are not thinking through the experiment…)
Here’s another perspective: Vermont’s reputation for willy nilly taxing away corporate profits - windfall or otherwise – assuredly discourages investment in this state – from out-of-state or otherwise. In the case of Entergy – we are simply stealing this money – whether you feel Entergy legitimately “earned” the profit – or was simply “lucky” because the cost of energy drove up utility rates! It would be no different than taking the entire winnings from the next Vermont Lotto and saying that because it was a “windfall” “profit”, the state is entitled to garnish the entire jackpot! So how many lotto tickets do you think would be sold after that? A lottery ticket is bought with the “hope” of winning – there’s noting altruistic about it’s purchase despite rationalizing the proceeds as benefiting the Vermont Education fund (which seems to be able to do just fine on its own). Businesses are created with the “hope” of making a profit. They are not created for the sole purpose of creating jobs (government bureaucracies do that). Another way of looking at it is that businesses are NOT created to loose money!
Carbon footprint? For every potential energy consuming job that Vermont discourages by its radical approach to “profits”, the Chinese – or anyone else -will simply step in and fill the void. They will increase their carbon emissions to make those products that could have been made in Vermont. Specialty Filaments in Middlebury struggled to compete with the Chinese equivalent. If I’m not mistaken, the state had to step in (with “incentives”) to keep that enterprise alive and retain some of those precious jobs.
We could slaughter our cows - significantly reducing the state’s greenhouse gas emissions. Of course Wisconsin would simply step up their milk production to take up the slack. Or, and this is fair, because the cost of feed has gone up (thanks to the alternative energy initiatives of the Federal government) milk prices will go up… and our farmers will see a windfall profit – either from milk or corn – that they did nothing to earn. Tax those windfall profits instead. Oops. They’re Vermonters.
The idea that Vermont can significantly reduce greenhouse gas emissions is a chimera. At best, Vermont can shift the net greenhouse gas emissions out of the state – and along with it – jobs.
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