Oregon's senior U.S. senator calls for a tax overhaul to support the Green New Deal
Oregon’s senior U.S. senator, Ron Wyden, says he intends to use his position as the ranking Democrat of the Senate’s finance and energy committees to push forward the agenda of the so-called Green New Deal.
Speaking in Street Roots’ offices on Saturday, Feb. 16, Wyden said he intends to replace the dozens of subsidies for fossil fuel industries with tax incentives for cleaner energy options. Wyden is on a tour of town halls in Oregon while the Senate is in recess until Feb. 22.
“There are 40 separate tax breaks for energy that are basically dirty energy tax relics,” Wyden said. “And what I will be proposing is throwing all 40 of them in the garbage can.”
Wyden said he intends to replace the fossil fuel tax breaks with only three: for clean energy, clean transportation fuel and energy effeciency.
The Green New Deal is a resolution crafted by Democrats on Capitol Hill to address climate change and a host of other economic and social concerns. Its most vocal champion has been Rep. Alexandra Ocasio-Cortez (D-N.Y.) The non-binding resolution calls for accomplishing the goal of net-zero greenhouse gas emissions within 10 years by building smart power grids, upgrading and building energy efficient buildings, removing pollution and greenhouse gas emissions in the transportation and agricultural industries, working to eliminate unfair competition and providing higher quality education, health care and housing for all.
Oil, gas and coal companies have received in federal and state subsidies about $20 billion, on average per year, for 2015 and 2016 – with more in the pipeline as a result of the 2017 tax overhaul that lowered corporate taxes. That’s based on information compiled Oil Change International drawing from federal and state budget and tax commission documents and the Organization for Economic Co-operation and Development or OECD.
The U.S. and 163 other member states agree to the World Trade Organization definition of a subsidy to include the transfer of funds in the form of grants, loans, equity infusion and loan guarantees below market value, as well as foregone revenue such as tax breaks and selling goods and services at below market rates.
In June, a collaboration of organizations published a policy brief dubbed the “G7 fossil fuel subsidy scorecard,” ranking the United States, France, Germany, Canada, the UK, Italy and Japan based on the G7’s agreed upon effort to reduce dependence on fossil fuels. The United States ranked last for providing “the highest level of total fiscal support to domestic coal, oil and gas production of all the G7 countries.”
Pacific Standard, the investigative journalism website for the nonprofit Social Justice Foundation (formerly known as the Miller-McCune Center for Research, Media and Public Policy), has been researching the tax documents on U.S.-based oil and coal companies along with the Institute on Taxation and Economic Policy, or ITEP, a nonpartisan, nonprofit research firm based in Washington, D.C.
Their analysis showed that 17 U.S. oil and gas companies reported a combined total of $25 billion in direct one-time benefits from the 2017 Tax Cuts and Jobs Act. And with additional tax benefits, many will actually receive tens of millions of dollars in income tax refunds this year, according to Pacific Standard’s March 2018 report.
Wyden said he wants to see tax incentives reward companies who buy cleaner and more efficient equipment for manufacturing.
“Right now, we’re not sending those signals in the marketplace, and that’s what the tax code has always been about,” Wyden said. “It’s a judgment about where you want to put your priorities. There is an opportunity to send profoundly different marketplace signals through the tax cuts.”
According to the Energy Information Administration, the 2017 U.S. mix of energy consumption was just under 13 percent from renewable sources and 78 percent from coal, natural gas and oil. Nuclear energy accounted for the rest.
While the Green New Deal is still a concept, Wyden made note of several efforts that direct local resource policy around the state’s forests and public lands. The Senate recently passed public lands legislation, championed by Wyden and fellow Oregon Democrat Sen. Jeff Merkley, to give the protected “wild and scenic” designation to nearly 2,000 miles rivers in Oregon. According to Wyden’s office, Oregon will now have the most wild and scenic river designations in the continental United States.
Oregon’s natural resources, specifically timber, have been it’s bread and butter for generations, but the state’s forests are also one of the best tools for fighting climate change. Wyden said he believes the new greener economy will support workers.
“We have a chance with solar and wind and hydro and geothermal to create jobs literally from one corner of the state to another.”
Oregon lawmakers in Salem are working to address climate change through a cap-and-trade plan to limit green house gas emissions beginning in 2021.
The bill would put a price on carbon emissions from the state’s largest emitters, and cap emissions to ultimately reduce carbon emissions to 80 percent below 1990 levels by 2050. The revenue from the new carbon emission allowances would help create more jobs in the state’s clean-energy sector, and offset the effects of climate change in other sectors.
In Portland this week, the City Council formally adopted the Portland Clean Energy Community Benefits Initiative, approved by Portland voters in the November election. The measure imposes a 1 percent surcharge on the retail sales within Portland of certain large retailers to fund clean energy projects and jobs training.
Most of the proceeds from the surcharge will be placed into a new Portland Clean Energy Community Benefits Fund to support the city’s Climate Action Plan. That plan prioritizes job training, apprenticeship programs, skills training and workforce development for economically disadvantaged and traditionally underemployed workers, including communities of color, women, persons with disabilities, and the chronically underemployed.
Wyden said he believes he can compel Republican members of the senate finance committee to be “sympathetic” to tax reforms because they support fewer energy subsidies. But he concedes the challenges ahead, not the least of which is the financial influence the fossil fuel industries have with politics, spending hundreds of millions of dollars on campaign donations and lobbying.
“We still have a long way to, and it reflects the facts: that fossil fuels still dominate,” he said. “And, of course, those are the people who best exploit Citizens United, this abomination of a Supreme Court suit, in order to pump enormous sums of money into political campaigns. So there’s very much a kind of interconnection between the heavy lifting we need to do to make changes and some of our challenges.”
Email Executive Editor Joanne Zuhl at joanne@streetroots.org.
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