Resource Tax for Our Ills
- 2011, Dec 01, 09:34 pm
A resource tax could: reduce waste, reduce carbon output, reduce our dependence on foreign oil, and generate jobs.
Some have the misconception that environmental protection is bad for business. Although it has often been in the past, it in no way has to be. A shift from income tax to resource tax would not only save precious natural resources, it would also boost employment.
The largest tax in the US is income tax. It is a tax on productivity. It is a tax which makes it cheaper to waste precious resources in order to save a few worker hours. Sales tax may indirectly tax resources but it also indirectly taxes income. A resource tax encourages conservative use of resources and ample use of employees in production. If the largest US tax was on resources, recycling and careful resource use would happen automatically.
I have personally seen the waste income tax produces. As a new apprentice electrician I was surprised and dismayed to discover, out of the three licensed electricians I was working with, only one recycles copper and only because he is an environmentalist. Although a large bag of copper wire is worth around a hundred dollars, the few minutes of time to set aside and recycle their scraps is worth more. Many industries have similar choices. They could preserve natural resources, but it would require more worker hours which are more expensive.
A resource tax would also be advantageous for those concerned with global warming. With taxes on oil and natural gas it pays to burn less. This bring me to the next benefit. With reduced oil consumption we will be less dependent on Arab oil and OPEC.
Before you lynch me, a resource tax can maintain our currant taxes' wealth redistribution. As many have pointed out to me, once people make over a certain amount, their resource usage does not increase significantly with income. This means, middle class people will be paying similar amounts as the rich. To continue taxing by what people can afford, the income tax could be shifted over. Meaning, shift all the income brackets over 30 or 40 thousand dollars. Some one making 28,000 would not pay any income tax. Some one making millions would still be in the top income bracket.
Although instituting any new tax is difficult, this tax is easier than any other recycling or job program. Most mining and drilling in the US is done by a handful of large corporations. This makes implementing a resource tax on domestically extracted resources relatively easy. The IRS could actually be scaled back. Over half of US citizens makes under 30,000. Since they are no longer being taxed the IRS no longer needs to track them.
My biggest question is how to deal with the issue of international trade. If we do not tax resources upon importation we will end up using similar amounts of resources, just foreign ones. It will also shift resource intensive manufacturing overseas. If we tax resources upon importation it could break trade agreements. Taxing the resources in ready made products is undoubtedly complex. I feel the best way to approach the issue is by pushing other nations to join us. Tell them, either join us in implementing a resource tax or we will tax resource in products from your country. I think many nations would eventually switch. I think we would actually be doing all the other nations a service. We would give them a precedent and an impetus for the institution of there own resource tax which will allow for the responsible use their own natural resources.
Despite the difficulty with trade I think the gains in employment and responsible resource use make this an option which should be researched and considered for implementation. I have trouble understanding why I have never heard this idea proposed by anybody other than me. Maybe it never occurred to anybody else. Anyways, spread the word. Link to this article and tell your friends. It may save your job one day.