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vermont
In First, Vermont Ready to Make Fossil Fuel Giants Pay for Climate Damage
"If you contributed to a mess, you should play a role in cleaning it up," said one supporter of a bill that could be a model for other states to follow.
May 09, 2024
Offering a model for others to follow, Vermont this week became the first state in the nation to pass legislation that would require fossil fuel giants to pay for the damage and disruption caused by their planet-warming products.
While it remains likely Republican Gov. Phil Scott will veto the bill passed by the state Senate in March and the House on Monday, the legislation—now heading for his desk—was celebrated as a blueprint for others to imitate.
As Vermont Publicreported:
Modeled after the federal Superfund program, the policy would require companies like ExxonMobil Corporation and Shell to pay Vermont a share of what climate change has cost the state in recent decades. Vermont would use those payments to establish a program to fund recovery from climate-fueled disasters and work to adapt to the state’s already-changed climate.
Vermont could become the first state in the country to enact such legislation. New York, California, Massachusetts and Maryland are all considering similar bills, as is Congress.
The fossil fuel industry has opposed the measure and vowed legal action if it becomes law. In March, the American Petroleum Institute (API), which represents oil and gas companies, called the legislation "bad policy" and argued that it "may be unconstitutional" for holding corporations responsible for what society at large has done.
Evidence has shown, however, that the fossil fuel industry knew about the climate impacts of burning coal, oil, and gas for decades, but hid those understandings from the public as it fought efforts to curb emissions or mitigate the damage being done.
"If you contributed to a mess, you should play a role in cleaning it up," Elena Mihaly, vice-president of the Conservation Law Foundation's Vermont chapter and a supporter of the bill, toldThe Guardian.
Like many other states, Vermont has suffered expensive damage from climate-related weather events in recent years—costs that proponents of the bill say should not be shouldered by the state alone when it's so clear the role that the fossil fuel industry has played to create the current crisis.
"You see towns across the state underwater, and communities and businesses financially devastated. The reality of the climate crisis just really comes crashing home," Ben Edgerly Walsh, climate and energy program director for the Vermont Public Interest Research Group, toldNBC News following passage in the House. "These are facts that we are dealing with in real time that we need the financial resources to deal with."
If Scott vetoes the bill, lawmakers in the state House and Senate would both have to muster a two-thirds majority to override his rejection.
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‘Climate Superfund’ Laws Could Make Big Oil Clean Up Its Own Messes
If a chemical company pollutes a site, the superfund law has been a way to make it pay for the remediation—so if Vermont’s flooding cost its taxpayers $2.5 billion to repair, why should they be on the hook?
Mar 17, 2024
One prong of the climate fight involves installing so much renewable energy that fossil fuel use actually declines dramatically—a few places are finally showing that’s possible, like sunny Germany which last week said emissions in 2023 dropped more than 10%.
But if that’s going to happen everywhere, and fast enough, it’s going to require the other prong: holding back the fossil fuel industry. The problem is that the politics of oil-producing countries don’t allow it—that’s why the Inflation Reduction Act was all carrots and no sticks. And it’s not just D.C.—in President Luiz Inácio Lula da Silva’s progressive Brazil the national oil company, already Exxon-sized, said last week it plans on outproducing all its peers except Saudi Arabia and Iran by 2035.
So you need a mechanism for places where there is no oil in the ground to inflict some hurt on Big Oil—and get some justice at the same time. Like, Vermont. And New York, and Maryland, and Massachusetts.
“Climate superfund” laws that treat disasters like Vermont’s summer flooding as if they were a toxic dump whose cleanup can be charged to the corporation that caused them.
In a just world, Big Oil would be criminally prosecuted, since investigative reporting has made it abundantly clear that it knew what it was doing (Aaron Regunberg and David Arkush last week laid out an excellent argument as to why these companies could be charged with homicide). In civil court, jurisdictions can simply sue the fossil fuel industry, and that’s actually been happening more and more often (on Wednesday a Belgian farmer sued French energy giant Total for making his life harder). Suits like that—many premised on the fact that Big Oil clearly knew about the dangers they were causing—are wending their way through the American courts, but our justice system is a) slow and b) bent in the direction of the powerful.
So legislators are opening up another front—“climate superfund” laws that treat disasters like Vermont’s summer flooding as if they were a toxic dump whose cleanup can be charged to the corporation that caused them. That would have been hard even a few years ago, but “climate attribution” science is now robust: It’s increasingly easy to prove that absent global warming we wouldn’t have the endless downpours, droughts, or fires. If a chemical company pollutes a site, the superfund law has been a way to make it pay for the remediation—so if Vermont’s flooding cost its taxpayers $2.5 billion to repair, why should they be on the hook?
I’m talking about Vermont because it might be the first state to adopt such a law, as it was the first to abolish slavery or allow civil unions—the legislature and the governor will decide in the next few weeks. And I’m talking about it because I live here, in a town that is struggling to pay for the repairs to its roads after last summer’s record flooding. We heard the sobering litany at town meeting earlier this month; every culvert makes it that much harder to keep our school open. New York is also close to passing such a law, and perhaps Maryland and Massachusetts, as Katie Meyers pointed out in Grist recently—all of them states without significant hydrocarbon production, and all of them states with a lot of climate damage.
Campaigners led by the Vermont Public Research Interest Group (VPRIG) launched the campaign last summer, accompanied by a 20-foot-long inflatable pig. VPIRG’s executive director Paul Burns, and Lauren Hierl, a member of the selectboard in flood-devastated Montpelier, explained the logic in an oped:
The biggest oil companies in the world made more than $200 billion in profits last year, while Vermonters were forced to pay record prices at the pump—and got stuck with the costs of climate change cleanup in our communities. That shouldn’t be the case. Big Oil knowingly made a mess of the climate. They should help pay to clean it up.
It’s a lesson we all learned in kindergarten: If you make a mess, you clean it up.
The argument has obviously appealed to legislators. Here’s the state’s news website, VTDigger, describing one of the more conservative Democrats:
Sen. Dick Sears, D-Bennington, who chairs the Senate Judiciary Committee, said he would have “absolutely opposed” such a bill 20 years ago. Chemical contamination in the Bennington area, which has permanently altered the lives of some of his constituents, changed his mind.
“Who’s going to pay for the damage done?” Sears said. “Is it going to be the taxpayer? Is it going to be the homeowner or the small business? Or is it going to be the company that contributed to the problem? I say it should be the company that contributed to the problem.”
It will be fascinating to see what the state’s governor, Phil Scott, does with the bill. He is a Republican, but a remnant one, harkening back to the state’s Yankee past. (For a hundred years until the 1960s Vermont was the most reliably GOP state in America). He brought the state through Covid-19 with fewer deaths per capita, and less division, than any other; and since he’s a contractor by profession he understands viscerally how much it costs to repair a road or rebuild a bridge. If he signed this bill, he’d be reflecting the clear consensus of the state’s voters. And the great marker of those Yankee Republicans was frugality—cheapness, but the good kind. It’s hard to imagine that he wants Vermont taxpayers on the hook here.
The oil industry (in between insisting that all of this is a plot by the Rockefellers) has hinted that paying these damages could raise prices for consumers, but that’s silly—the price of oil is set on a world market. And they’ve of course promised to go to court if they are charged for their damage. Vermont’s got good lawyers—it’s got one of the best environmental law schools in the nation. And New York State has lawyers upon lawyers, as Donald Trump is finding out. Massachusetts governor Maura Healy used to be AG, and she’s taken on big oil in the past. It’s a fight, but a winnable one.
Yes, it would be best to do this at the federal level (and Vermont’s Senators Bernie Sanders and Peter Welch have introduced legislation to do just that). But the Senate filibuster means that oil states will have enough clout to block those laws, at least while they could still do some good. So for a while it’s going to be a coalition of the oil-less (you can ask your state to get involved here).
It’s been a great blessing to Vermont that there’s nothing much of value beneath the soil (well, granite, but a few quarries are enough to produce an eternity of tombstones). And now that geological fact may prove to be of great value to the planet.
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After Success in Massachusetts, Lawmakers in 10 States Push Wealth Tax
"If you want better roads, better schools, better healthcare, better public transit... or just a generally better life, then the best way of funding that is by taxing the ultrawealthy, not allowing them to exploit more tax loopholes."
Jan 24, 2024
While ultrawealthy Americans are unlikely to face any extra federal taxes any time soon due to the makeup of Congress, legislators in at least 10 U.S. states this year are aiming to pass tax policies targeting their richest residents to raise revenue for the common good.
Lawmakers in California, Connecticut, Hawaii, Illinois, Maryland, New York, and Washington introduced coordinated wealth tax bills a year ago. Some were inspired by U.S. Sen. Elizabeth Warren's (D-Mass.) 2020 presidential campaign proposal, which featured a 2% annual tax for assets above $50 million and a 3% tax for assets over $1 billion.
Now, less than a month into 2024, legislators in 10 states are developing or have introduced wealth tax bills. Amber Wallin of the State Revenue Alliance confirmed to The New York Times on Tuesday that all of the states that were working on such legislation last year, except Illinois, have been joined by Minnesota, Nevada, Pennsylvania, and Vermont.
"A new wealth tax in Massachusetts last year that was expected to raise $1 billion actually raised $1.5 billion, helping to fund green infrastructure, education, and childcare."
"The way our tax structure is set up, our middle class is carrying an undue burden, compared to folks at the top," Democratic Vermont Rep. Emilie Kornheiser (Windham-7), told the Times. "We want to make sure that all Vermonters are paying their fair share."
Kornheiser, who chairs the state House Committee on Ways and Means, is sponsoring H. 827, which would tax the unrealized gains of Vermonters with over $10 million in assets after exemptions, and H.828, which would impose a 3% surcharge on individuals' incomes of $500,000 or more.
The panel that Kornheiser leads discussed the legislation on Tuesday, though it remains to be seen whether the bills' backers can get them out of committee—where all of last year's proposals died. Democrats have supermajorities in both chambers of the Vermont General Assembly, but as Bloombergnoted, the hearing for the new bills was held "just hours after Republican Gov. Phil Scott presented a fiscal year 2025 budget that steers the state away from new taxes and fees."
It's not just Republican officials who pose potential roadblocks to increased taxes on the rich.
"Texas voters overwhelmingly passed a constitutional amendment in November that would preemptively bar any future efforts by the state to tax wealth or net worth," The Times pointed out. Earlier this month in California, Democratic Gov. Gavin Newsom, who is widely considered a possible 2028 presidential candidate, "rejected the idea of plugging the state's $37.9 billion budget deficit with a wealth tax."
Despite such opposition, polling suggests most Americans want the ultrarich to face tax hikes. Pew Research Center found last April that 6 in 10 U.S. adults say the feeling that some corporations and wealthy people don't pay their fair share bothers them a lot.
Even three-quarters of millionaires across G20 countries "support higher taxes on wealth to help address the cost-of-living crisis and improve public services," according to polling from last week. That survey was released as 260 millionaires and billionaires implored political leaders at the World Economic Forum in Davos, Switzerland to raise taxes on the wealthy.
The Institute for Policy Studies (IPS) highlighted on social media Wednesday that state lawmakers already have a model proving how such legislation can improve the lives of residents: Massachusetts' Fair Share Amendment, which was passed through a 2022 ballot initiative and requires those with incomes over $1 million to pay a 4% annual surtax.
"A new wealth tax in Massachusetts last year that was expected to raise $1 billion actually raised $1.5 billion, helping to fund green infrastructure, education, and childcare," IPS said in response to the Times reporting.
Justice Democrats also welcomed news of the state-level efforts,
saying that "if you want better roads, better schools, better healthcare, better public transit... or just a generally better life, then the best way of funding that is by taxing the ultrawealthy, not allowing them to exploit more tax loopholes."
The fresh push for wealth taxes comes as states face anticipated drops in revenue. In a November analysis for the Center on Budget and Policy Priorities (CBPP), senior adviser for state tax policy Wesley Tharpe found that as the Covid-19 pandemic raged from 2021-23, 26 states cut personal or corporate income tax rates, with half of them doing so multiple times.
Of those 26 states, only Connecticut, New York, and Pennsylvania have legislators working on wealth tax legislation. However, as Tharpe explained in a Wednesday blog post, federal pandemic relief has expired, and all the states that slashed taxes now "stand to collect an estimated $111 billion less over the next five years than they otherwise would have, with the price tag in lost revenues hitting nearly $30 billion a year by 2028."
"Shrinking revenues will jeopardize current levels of state support for vital public services like schools, health services, and income support programs," he warned. "They will also constrain states' future potential by limiting policymakers' ability to make new investments to tackle unmet or emerging needs and issues, such as child poverty, the health of pregnant or postpartum people, or housing affordability."
Tharpe argued that state policymakers "should seize the opportunity to break the tax-cut fever and pivot in a more equitable, prosperous, responsible, and forward-looking direction." He even provided some examples of states that "have recently shined a light on a different, brighter path of protecting and raising revenues to support current services and new investments."
In addition to Massachusetts' amendment, he pointed to Minnesota's crackdown on corporate tax avoidance and Washington's new excise tax on income from the sale of stocks and other investments, which targets the wealthiest 0.2% of Washingtonians.
"States including Colorado, Maine, New Jersey, New York, and Vermont, and the District of Columbia have also raised new revenues to fund initiatives like universal free school meals, expanded childcare and paid leave, and more affordable housing options," the CBPP expert noted. "More states should follow suit in 2024 and beyond."
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