The Corporations’ Sod-You Culture

Big business tries to stop energy taxes

By George Monbiot. Published in the Guardian 21st October 1999.

There are lies, damned lies and employment figures. Whenever plans for a superstore are unveiled, the developers promise that it will create hundreds of new jobs. Local papers repeat the claims uncritically, apparently unaware that the supermarkets’ own figures show that every store opening throws a net 276 people out of work.

Similarly, whenever a business wants to delay progressive change, it starts bellyaching about jobs. Companies which have no qualms about shedding thousands of workers when convenience dictates suddenly acquire a touching solicitude not only for their own employees but also for the hundreds of thousands of people in related industries said to be wholly dependent on their success. If you added up all the jobs which business claims have been put at risk by new policies over the last two years, you would soon discover that Britain had a workforce of several hundred million.

This is the rotten stick with which British companies have been beating the government’s proposals to tax energy use. Since March, the Confederation of British Industry has been bamboozling senior ministers and waging war through the pages of the Financial Times. The energy tax proposed in this year’s budget is, the CBI claims, “playing Russian roulette” with employment. While the government has offered a generous 50 per cent rebate to companies investing in energy efficiency, the CBI wants 95 per cent. Ideally, it would like to pay no tax at all, and try instead to reduce fossil fuel use by “emissions trading”: the buying and selling of permits to produce carbon dioxide.

On Tuesday, the Telegraph reported that the government had flinched. The Environment Minister Michael Meacher, it claimed, was considering cutting the tax. His department denies that it has changed its policy, but there’s no question that both Meacher and his boss John Prescott have been squeezed till they’re green in the face. They are among the few ministers prepared to confront a government machine which would happily deliver humanity to hell in a handcart in return for a couple of marginal seats at the next election.

They know that 1998 was the hottest year of the millennium, that the Arctic ice cap is melting, that the drought-prone regions of the world are spreading, and that the Gulf Stream could be slowing down. But they are lonely voices in a Cabinet dominated by scheming technocrats. They are bullied and blamed for policy failures originating in Downing Street. There are blood-curdling tales of Jack Cunningham, the former Cabinet Office crocodile, roaring at Michael Meacher in front of other ministers for being off message.

Their attempts to make the government honour its international climate obligations started badly. Gordon Brown appointed Lord Marshall, the chairman of British Airways, to investigate the feasibility of the energy tax they proposed. BA has long resisted the taxation of its own energy use, lobbying fiercely against a levy on aviation fuel. But Lord Marshall, to many people’s surprise, suggested a workable, if timid, approach. Far from threatening the workforce, his levy is designed to stimulate employment, by shifting the burden of taxation from jobs to resource use. Energy tax revenues will be ploughed into fuel efficiency measures and National Insurance rebates. A report commissioned by the WorldWide Fund for Nature shows that businesses employing 93% of the UK workforce will either be unaffected or will actually gain from the tax shift. The most energy intensive companies in the UK will pay extra taxes amounting to just 1.6 per cent of turnover.

One might have imagined that corporations would campaign in favour of fiscal changes which, in the long run, will reduce their tax contributions and help them to cut their energy bills. But this would be to underestimate the inertia and bloody-mindedness of the so-called “can-do” culture of modern corporations. Lazy, backward-looking, big business in Britain will fight relentlessly to protect its short-term profits (and hence its directors’ bonuses), even if this leads to long-term loss.

The 95 per cent rebate the CBI is demanding is moonshine. If energy efficiencies this big can be extracted, then companies will surely have found them by now, as they would pay for themselves in just over a year. Emissions trading of the kind the CBI proposes is easy to fudge and almost impossible to police. It is open, in practice, only to big corporations, leaving smaller firms to pick up the tax bill.

Both proposals are simply novel means of taxing the energy of the ministers and campaigners seeking to tackle the world’s most pressing problem. The corporate “sod you” culture is, once again, shoving its stick into the spokes of a sustainable future.