How green policies hurt the poor

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[/audioplayer]Advocates against global warming often frame the issue in terms of helping the poor. ‘You’re right, people dying thanks to climate change is some way off…’ ran one fairly typical advert recently, ‘about 5,000 miles, give or take.’ Indeed, the United Nations agrees that, looking toward the future, climate change ‘harms the poor first and worst’. And the logic stacks up: the poorer you are, the less able you’ll be to afford the resources to adapt to a changing climate. However, climate policies also have a cost, and these predominantly hurt the poor. And if you really want to help the poor, there might be much more efficient ways to help than by cutting emissions.

Britain’s environmentalists proudly announce that households have reduced their electricity consumption by almost 10 per cent since 2005.They seldom mention that this is helped by a 50 per cent increase in electricity prices, in part to pay for Britain increasing its share of renewables from 1.8 per cent to 4.6 per cent. Such a price increase of course hits the poorest hardest. As with many green taxes, it does so because it taxes a basic necessity that makes up a larger proportion of a small budget. Not surprisingly, higher energy prices mean the poor are forced to reduce their electricity consumption far more than the richest, who haven’t reduced their electricity consumption at all.

Over the past five years, heating a home in the UK has become 63 per cent more expensive, while real wages have declined. Unsurprisingly, a greater number of poor households must spend more than 10 per cent of their income on energy, becoming what is known as energy poor.