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Budget’s missed opportunities: Why not tax junk food and plastic bags?

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Jonathan Starling

It has been five years now since the first great depression of the 21st Century, brought on by the internal contradictions of neoliberalism, and now we have the first OBA Budget. Crises represent both opportunities and dangers. The OBA Budget is similar; it represents opportunities, dangers and missed opportunities. Here I will outline some of the missed opportunities and dangers of this Budget.Green ShootsThe economic crisis represents an opportunity to develop new economic models and routes out of the dead-end of neoliberal policies. However the Government has failed to take a green route out of the crisis.In increasing licensing costs for vehicles, the Government has missed an opportunity to move beyond the limited size-based criteria for vehicles and create a better model which adds into consideration the fuel efficiency of vehicles. They have also adopted a purely ‘stick’ approach when they could have added a ‘carrot’ in using revenue generated to subsidise the costs of more fuel-efficient vehicles (electric and hybrids). In the long-term this would prevent money leaking out of our economy needlessly in terms of fossil-fuels, allowing savings to be spent on alternatives.Increasing bus fees (although the details are sketchy at the moment) is counter-productive for reducing traffic congestion and encouraging public transportation (a more cost-effective and energy efficient mode of transport).The various ‘sin taxes’ are welcome, from a health perspective and revenue generator, but lacks vision.These could have been extended to ‘junk-foods’ (in many ways equally addictive drugs) with the revenue generated going to subsidise basic food staples and healthier options (rice, beans, fresh produce, bread). The long-term benefits of such a carrot-and-stick approach may lead to savings from healthcare, increased productivity in the workplace, as well as helping protect costs of living for workers.Government could introduce a carbon tax on imports, particularly for products (mostly fresh produce and various seafoods) that can be produced locally. Revenue generated could then be used to subsidise local production, as well as green technologies, both generating jobs and reducing long-term costs for Bermuda.A deposit scheme for beverage containers (bottles and cans) would generate savings in the long-term in terms of waste-collection (with these being the bulk of roadside waste) and healthcare (as they provide breeding grounds for mosquitoes). There are additional benefits, both in terms of the ‘Bermuda image’ and for conservation of our endemic skinks, with potential benefits for tourism.Similarly, a plastic bag tax would not only generate revenue but encourage more sustainable lifestyle changes, as well as enhancing our Bermuda image and eco-tourism credentials.There is also the opportunity for Government to convert its energy requirements from a dependency on fossil-fuel (leading to money leakage) to renewable energy sources. An aggressive campaign to convert Government buildings (schools, offices, the Aquarium, etc), while requiring an initial capital cost, would lead to long-term savings in operating costs. The return on investment will not only pay for the capital investment, but also allow future monies to be reallocated. Additionally, this approach provides job opportunities and can kick-start similar private sector initiatives.In line with green energy options, Government could extend reverse net-metering to commercial buildings. Currently houses which produce their own energy can receive rebate from Belco for the energy they feed back into the net. By extending this to commercial enterprises Government would provide an added incentive for business to adopt green technologies, spurring job growth and reducing leakage from fossil-fuel dependency.Eco and Cultural TourismRather worryingly the Budget reveals steep cuts to the Ministry of Community and Cultural Affairs and to the Departments of Conservation Services (which includes the Aquarium), Parks, Planning, Energy and Sustainable Development.In tourism we cannot compete with the mass tourism of the Caribbean. But we can compete in terms of Eco and Cultural Tourism. Cuts to the above Ministry and Departments undermine our capacity in this direction, and, indeed, risk long-term threats to our natural and cultural attractions. This is a retrograde step, one that may accelerate our tourism decline rather than reverse it.Similarly, cuts to the Sustainable Development and Energy Departments undermine the capacity to initiate a green route out of the crisis.Workers’ and Residents’ RightsCrises represent opportunities, both for developing a more just society and for a more exploitive system. There is a risk during economic crises that business will seek to rollback workers’ rights and exploit labour.One step to reduce the risk of exploitation, and defuse social tensions (in as much as expatriate blue-collar workers are often seen as depressing wages) would be to introduce a minimum (and living) wage. This would ensure that workers are protected and paid a fair wage for work, rather than being exploited. This may reduce the demand for blue-collar expatriate workers and encourage more Bermudians to enter certain occupations, leading to long-term savings.The reduction of land licence fees for foreigners is bound to inflame social tensions. It would be more beneficial to lift all restrictions on PRC holders in this area, ensuring that those individuals who have integrated into our society benefit more than novel individuals.Government also needs to greater regulate the mortgage sector. Existing rates are presenting unacceptable levels of stress in our society, and contributing to various social problems, with resulting social costs.Power to the PeopleThere are concerns about the SAGE commission. It appears not dissimilar to initiatives in the UK and the USA, which are effectively stealth means of privatisation and union-busting. These commissions have too often been insulated from parliamentary oversight, given freedom to bypass collective agreements and mandated to explore outsourcing or privatisation of the public sector.Government should also devolve greater power to the people through participatory budgeting.Participatory budgeting has been developed since the 1980s, and is now increasingly in use at municipal and state levels throughout Latin America, Europe and North America. It gives citizens a vote in how public monies are spent. It leads to more efficient uses of public monies while also increasing civic engagement and buy-in — with resulting additional benefits for society.Public Works, and the Community and Cultural Affairs represent two areas of Government which could particularly benefit from, and work as, pilots for participatory budgeting.

Addictive: Taxing junk food would be a sin tax that showed some vision