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SPEAKOUT: Ritter tax hike will hurt poor

By Roy Innis

Published May 15, 2008 at 12:05 a.m.

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The Congress of Racial Equality and Colorado Consumers for Affordable Energy (CARE) recently voiced their growing concern that Gov. Bill Ritter's proposed oil and gas severance tax increase would seriously hurt Colorado's poor families. Families are already reeling from soaring energy and food prices, and this new tax would push many over the edge.

But to hear the Rocky Mountain News tell it, the primary thing motivating me and CARE director Bishop Phillip Porter to speak out on this and other energy issues are contributions CORE has received from energy companies ("Severance tax battle heats up/Foes of hike tied to civil rights group backed by industry," May 1).

The truth is, our opposition to policies like the Ritter tax is based on an undeniable fact: They drive up the cost of everything we do, and they hurt low-income families the most. When prices for transportation and home heating fuel, food and other necessities go up, low-income families bear a disproportionately higher burden for those price spikes than the well-to-do.

According to Energy Outreach Colorado, the state's low-income families spend an average of 20 cents out of every dollar they earn on energy. The poorest families spend as much as 50 cents on the dollar. By contrast, median-income families spend only 5 cents per dollar on energy - wealthy families even less.

When families have trouble paying energy bills, they skip meals, put off health care, suffer unsafe temperature extremes, and sometimes heat their homes in unsafe ways.

As I note in my book, Energy Keepers, Energy Killers, these disproportionate impacts on minorities and low-income families are driven in part by extremist environmental policies that restrict energy supplies, raise energy prices and discriminate against the poor. This is the civil rights issue of our time.

Environmental elitists pushing the Ritter tax want higher prices because they know this forces people to consume less and endure lower standards of living. These elitists claim this protects the environment.

What shocks me is that Ritter seems to have bought into this argument.

Doesn't he understand that higher energy prices mean higher food prices?

Poor families rely heavily on grains that have doubled in price, and people are rioting because they can't get enough to eat. Experts say these soaring food prices are driven by higher costs for petroleum-based fuel, fertilizer and insecticides, and by the diversion of cropland to ethanol production.

And yet, the governor's spokesman defended the proposed tax hike by saying "not one drop of the natural gas produced in Colorado ends up in anyone's gas tank." Even more amazing, the Rocky failed to mention that this new tax would apply to natural gas and oil, which is refined into gasoline.

Higher wellhead prices for oil will bring higher prices at the pump. As a chemist by training, I know that natural gas is vital in gasoline refining, so increased production costs for this fuel will impact gasoline prices.

Higher natural gas prices also will raise the cost of fertilizer, pharmaceuticals, plastics and other products - and home heating.

Perhaps Ritter endorses the severance tax because he believes it's fair to force higher prices on consumers in exchange for scholarships funding. I don't think such trade-offs are good policy. There are other ways to improve education funding than on the backs of our poorest consumers.

The question is, will Coloradans agree that the Ritter tax fosters consumer protection, civil rights and environmental justice, when:

* 360,000 Colorado households that rely on home heating assistance will see their heating bills go even higher;

* 2.7 million Colorado drivers are hit with even higher gasoline costs;

* 4.7 million citizens of this great state watch food costs eat up more of their family budgets?

We'll know the answer this November, when the voters pass judgment on the Ritter tax. I, for one, will be encouraging everyone in Colorado to oppose this anti-consumer ballot initiative.

Roy Innis is the national chairman of the Congress of Racial Equality. He is a resident of New York City and North Las Vegas, Nev.

Comments

  • May 15, 2008

    5:05 a.m.

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    roger44 writes:

    Ritter is a good example of the failure of higher education. He might have a degree, but he isn't smart enough to connect the dots. Just like the idiots that try and tell us ethanol doesn't affect the price of food.

  • May 15, 2008

    6:21 a.m.

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    jr_mcmillin writes:

    What is Ritter thinking? What are his advisers thinking? You tax anything consumable and it hits us, the consumer, with higher prices. Even the federal government understands this by thinking about halting the gas tax for a time to alleviate high prices. Will they do it? This remains to be seen, at least they understand the concept. Unfortunately, the Governor of Colorado and his advisers are clueless. This will become more interesting as November approaches.

  • May 15, 2008

    7:13 a.m.

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    jacka writes:

    This administrations policies continue deliver these undeniable facts: They drive up the cost of everything we do, and they hurt low-income families the most. When prices for transportation and home heating fuel, food and other necessities go up, low-income families bear a disproportionately higher burden for those price spikes than the well-to-do.

    This occurs with this tax increase, the property tax increase, the unionization of state employees, and every other policy they've signed into law.

  • May 15, 2008

    8:30 a.m.

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    socrates writes:

    This is precisely the reason we need to pass the initiative. Energy prices are going up - Xcel recently proposed a 15% rate hike, not because of renewables and efficiency but because of the price of natural gas. Food prices are going up because the average distance our food travels from farm to plate is over 2,000 miles - Diesel fuel is over $4/gallon. This continues to squeeze low income families.

    Ritter's solution is simple - hedge the increases in energy costs by diversifying, advancing renewable energy, and becoming more effiicient in the energy that we use. But also recognize that higher education costs are continuing to go up, so make college more affordable for low and middle income Coloradans by providing them with assistance through the opportunity scholarships.

    The smokescreen of these energy companies won't work. They are enjoying gas prices over 10 times what they were five years ago and oil prices over 5 times what they were five years ago - meanwhile the costs of college and energy continue to rise for colorado consumers.

    These oil and gas companies need to become good colorado citizens and not continually take from our state's future.

  • May 15, 2008

    8:37 a.m.

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    fatheromalley writes:

    If "switch grass" were used corn prices would go down. NOT.. farmers would simply switch from Corn to switch grass on their acreage... wheat would be the same.. less acreage means less corn, less wheat, less beats..

    Price of oil is sky rocketing, our tithe to Allah no doubt..

    "This administrations policies continue deliver these undeniable facts: They drive up the cost of everything we do"..

    Uh, yeah.. errrr everytime you "stick it to the man" with taxing, you are only "sticking it to yourself".. we pay at the counter..

    All taxes on success, all taxes on business drives up the cost.. that too is an "undeniable" fact.. This "administration", bwahahahahahaahahhahah

    It's everytime we tax success.. you get your mind around that, we might just be able to give America a "re-birthing" experience she seems to desparately need. You want change? Stop taxing success, and tax consumption. Completely Untax the poor!

    www.fatheromally.com browse within the site, I'm sure there is plenty there to get you p.o.ed and make you happy.. lots of videos.. lots of laughs.. YOU want change? Really? I don't believe you..

  • May 15, 2008

    8:52 a.m.

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    AngelontheSidelines writes:

    If the poor need energy, let them burn furniture.

  • May 15, 2008

    8:57 a.m.

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    Marshdale writes:

    I would like to know how many of you so called experts on issues such as this have actually spent a day in the legislature listening to these debates. There is a hell of a lot more to it than you read in the papers.

  • May 15, 2008

    9:04 a.m.

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    mrfxx writes:

    As everyone who believes in no taxes keeps pointing out, businesses simply add taxes to the cost they forward to the "buyers" - which is why we need a tax system that hits individuals - starting with the CEOs making 300-500x what the workers make. No more "breaks" for capitol gains - often on stocks which were never taxed to begin with. Maybe the idea of a flat tax on all income regardless of source isn't so bad after all - and no more "discounts" for home ownership or fertility!

  • May 15, 2008

    9:14 a.m.

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    mark79trans writes:

    Good article!!!

    "Posted by Marshdale on May 15, 2008 at 8:57 a.m. (Suggest removal)

    I would like to know how many of you so called experts on issues such as this have actually spent a day in the legislature listening to these debates. There is a hell of a lot more to it than you read in the papers."

    In a former professional life, I wrote the talking points and drafted the legislation (a politico legislative staffer)…it is mostly mindless garbage now; the senseless debate on the floor makes me ill.

  • May 15, 2008

    3:07 p.m.

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    P_Denver writes:

    The logic of "The truth is, our opposition to policies like the Ritter tax is based on an undeniable fact: They drive up the cost of everything we do, and they hurt low-income families the most. When prices for transportation and home heating fuel, food and other necessities go up, low-income families bear a disproportionately higher burden for those price spikes than the well-to-do. " is faulty

    ANY price increase on ANYTHING hits the poor disproportionately. An increase which is chump change to the wealthy may be back-breaking to the poor. Housing, gas, cars, food, you name it -- increases hurt the poor more.

    It's always been that way and it always will be -- unless you are preaching socialism, where all the "basic" goods and services are given to "the poor" for free. All that happens then is the line for "poor" is raised, the definition of "basic" expands and redistribution of wealth accelerates.

    Rational alternatives are few: tax relief or governmental cash incentives for the poor (do-able, but problematic), tiered pricing by the energy suppliers (complex), or government intervention to cap pricing (really, really bad!).

    One thing for sure: the most "politically correct" answer will win in this election year -- not the most rational financial plan.

  • May 15, 2008

    5:06 p.m.

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    Hank writes:

    Roy Innis? Holy cow! Here's an eye opener - try googling
    "Congress of Racial Equality"
    "Roy Innis"
    and

    "Idi Amin"

    http://www.google.com/search?hl=en&am...

  • May 15, 2008

    6:14 p.m.

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    jjez writes:

    AngelontheSidelines---most poor don't have fireplaces. And even if they did, what would they do on the no-burn days? And I'm sure that the particulates produced by the chemicals in the finishes on the furniture would cause even more pollution. Not to mention poison those in the house! So I really hope you were joking when you said that. Cuz if you weren't, you should rename yourself DevilonmyShoulder.

  • May 15, 2008

    6:20 p.m.

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    jjez writes:

    socrates---just because you have a college education doesn't mean you're going to get a job! But I agree that the cost of higher ed in CO is ridiculous! And guess where a lot of it goes! Salaries for the admin staff. Buildings that aren't really needed. And those who have those high-priced diplomas expect pay commensurate with that piece of paper. I just wonder when all of these overpaid people are going to get a clue that in this day & age, greed is NOT good? Whatever happened to living simply? Why do two people need a 30,000 sq ft house to live in? That they have to heat, cool & light. So they have to make even more money to pay for it, which means they charge more for the services (if they can) which costs the consumer more. And round and round we go!

  • May 15, 2008

    6:54 p.m.

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    Acemon writes:

    "Tax the rich to feed the poor until there are no rich no more."
    "If 5 percent appears too small, be thankful I don't take it all."

  • May 15, 2008

    7:07 p.m.

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    freethinker07 writes:

    Okay, if we have to have government, what activities should be taxed to support it?

    Any activity that can be taxed is either used by the poor, or employs poor people in it. So any tax will hurt poor people.

  • May 15, 2008

    7:54 p.m.

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    socrates writes:

    Thanks to Hank for that post. Wondering who this guy Roy Innis is?

    "Roy Innis came to power within CORE during the Black Power era after a tumultuous and divisive internal struggle. He led the drive away from inter-racialism and toward an increasingly conservative black nationalism/capitalism. According to one former member of the group, Innis opposed the leadership of Gladys Harrington, the long-time head of the New York chapter of CORE, saying that women should not head black organizations. During the 1970s, Innis and CORE supported the murderous Ugandan dictator and Nazi sympathizer, Idi Amin, stating, "Ugandans are happy under General Amin's rule of Africa for black Africans” and terming the despot’s decision to expel 50,000 Asians from the country "a bold step." The following decade, Innis reportedly said “the so-called anti-Apartheid struggle” was "a vicarious, romantic adventure" with "no honest base." Also in the 1980s, Innis teamed with Bob Grant, the right-wing radio host who at one point called Dr. King a "scumbag," to form the Howard Beach Legal Defense Fund, which assisted a group of white youths who had chased a black man into the street to his death in a racial attack. Innis supported the nomination of Robert Bork to the Supreme Court and publicly defended “subway vigilante” Bernhard Goetz who shot and killed four African American youth on a subway in New York City in 1984."

  • May 29, 2008

    10:47 a.m.

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    orangecrush989 writes:

    The fact of the matter is that this tax would increase Colorado revenue by $300 million a year through closing a loophole that allows oil companies to avoid paying tax. Colorado is the only state in the US that allows this tax. This will not raise energy costs. Alaska has the highest energy tax in the US, yet they pay the same fuel costs as every other state in the nation. This initiative will allow aprox. 50,000 low income low income people to attend higher education through merit scholarships. I know the blow hards believe that this will hurt our economy, yet there is no proof that this will be the case. Energy costs are set by the market, not by the state. Exxon alone had $40 BILLION in PROFIT! Yet a little $300 million in Colorado for education, wilderness, transportation, and water treatment (think Alameda, how many business want to come to a state without infrastructure or educated workers?). Benefits greater than costs towards working citizens. Don't be a pawn of oil and gas companies like Mr. Innis

  • August 25, 2008

    7:47 p.m.

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    kkraus writes:

    The only reason a tax hike should be necessary in this increasing population in this state is mismanagement of collected taxes.1. our prisons are overflowing - so reduce them by deporting the illegals. Every year Colorado pays millions of dollars to support illegals in our prison system. 2. Deport illegals in this state working for slave wages(the cost of services and produce is not passed on to the consumer. Have you noticed?)This would open up more jobs for American citizens that pay taxes. Thus increasing the tax base.(Illegals send the largest portion of their paychecks back to Mexico. Thus increasing Mexico's tax base. In fact this is the 2nd largest product in Mexico. 3. Decrease the size of Colorado's state government and reduce the retirement benefits of government officials. And suddenly no need to raise taxes on those middle class Americans already hurting from the climate change hoaxsters. And no need for redistribution of anyones money for all the brainwashed socialists out there.

  • September 12, 2008

    7:31 p.m.

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    ynorris writes:

    How many of you actually understand how fuel prices are set? How many understand that the cost of crude oil is set on the world commodities market, not by politicians? The reality is that the oil & gas produced here in Colorado does not make a major impact on world prices. It accounts for a fraction of the global supply.

    The 'passthrough' costs everyone are worried about start at the wholesale refining & distribution level, not the primary driling & crude production level. These will come to you & I regardless of this amendment - stop kidding yourself if you think otherwise. Do a slight bit of true industry research and you'll comprehend this.

    The fact is that the oil & gas had a heavy hand in writing the original bill that gave them the property tax exemptions and they are the exact same group that is leading the charge this year to mislead you and most of the public about how this bill is going to drive prices through the roof. Do some reseach on who is paying for all those ads you hear. They just don't want to finally have to pay what they should have been paying for the past 30 years.

    And the reality is, $321M is a drop in the bucket in the scheme of overall costs to drill & produce. If you are naive enough to think that an $321M increase in Colorado is going to affect everything you buy in Colorado, I have some oceanfront property near Frisco for you to buy. A vast majority of what we purchase in Colorado is not made, produced or grown here. The cost increases at Safeway on the fruit from Chile or the almonds from California, have very little to do with gas wells on the Western Slope - it has everything to do with the worldwide price increase in oil - something that ending a $321M Colorado industry subsidy will have no effect on.

    Rather than just complaining about something, educate yourself and make an informed decision. If you are tried of seeing news reports of energy companies makes record profits, start to make changes here at home - ending tax subsidies is a start. Conservation and ending our dependance on their products is the only true answer.