May 20, 2024

Keeping Media and Government Accountable.

Research shows poor people are the hardest hit by green energy costs

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The price impact of green energy policies on necessities like gasoline, home heating oil and electricity impose a greater cost on low-income families relative to the wealthy according to a new study.

Dr. Casey Mulligan, professor of economics at the University of Chicago, and a contributor to the Committee to Unleash Prosperity, demonstrates that moving away from reliance on fossil fuels toward renewable energy costs the poor a greater percentage of their income. Instead of being portrayed as “victims” of a warming planet, low-income Americans will be forced to pay more of their income for a green energy solution.

For example, Mulligan says a fracking ban will cost families with the lowest 20% of household income (bottom quintile) 6.8% of their income in higher energy costs, compared to just 1.3% for families in the top quintile.

Kansas Governor Laura Kelly and some legislators pushed for the elimination of the sales tax on food for precisely the same reason – low-income families spend a higher portion of their income on food and the sales tax on food purchases.  The Sentinel asked Senate Minority Leader Dinah Sykes (D-Lenexa) and others who pushed for eliminating the sales tax on food how they reconcile support for green energy initiatives with the regressive impact on low-income families, but they would not respond.

Mulligan summarizes his findings:

“None of this should be a surprise. An active regulatory state is a playground for the privileged class to indulge its own preferences at the expense of ordinary Americans.”

Writing in The Detriot News, columnists Michael Jensen and William Shugart in 2016 illustrated the political hypocrisy of climate change policies currently in vogue:

“Modern progressives, who have long fancied themselves as champions of the poor, now see energy policy only through the lens of climate change. Their call to reduce greenhouse gas emissions, at any cost, drives public policy. Consequently, the sources of our most reliable and affordable electricity, existing coal power plants, are being shut down across the country as overzealous federal and state regulatory mandates force utilities to use less reliable, and more expensive sources such as wind and solar power.

“For those on fixed incomes, increasing energy prices mean that the gap between what they can afford to pay and what they are paying for electricity is widening. If we continue to push aside cheap coal-generated electricity for more expensive alternatives, many more of the nation’s poor will fall into that gap as they struggle to keep their lights on and their refrigerators running.”

Mulligan’s research is a reminder of Nobel Prize-winning economist Dr. Milton Friedman’s comment on evaluating government policy:

“One of the great mistakes is to judge policies and programs by their intentions rather than their results.”

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