Draft GPUS Platform Amendment True Cost Pricing

2004 PLATFORM ON TRUE COST PRICING

Middle-class and poor people are paying an ever greater proportion of federal taxes, and too often local and state taxes are unfair and regressive. The tax code is a labyrinth of deductions, loopholes, exemptions and write-offs, the result of insider- and industry-lobbying that has damaged our economy as it has served the interests of big business, financial institutions and the rich.

The high price of corporate welfare corrupts the political process by encouraging the exchange of political favors for campaign donations. Corporate tax breaks are ultimately paid for by higher taxes on the middle class. Tax breaks distort the rules of the marketplace and seldom serve a larger public purpose.

We call for a tax policy that moves to eliminate loopholes and other exemptions that favor powerful interests. Small business and the self-employed, in particular, should not be penalized by a tax system that benefits those who can influence the legislative tax committees for breaks and subsidies.

A central goal of tax policy should be transparency – a system that is simple, understandable, and resistant to the schemes of special interests.

When taxes are levied against labor, using labor in production becomes more expensive and is therefore a disincentive for employment. This also diminishes the economic value of labor by decreasing the worker’s purchasing power thus discouraging work.

Corporations focus on revenue growth at the expense of nearly everything else. Even breaking the law can be justified when the fine for being caught is less than the profit to be made. We must motivate the business community to act responsibly towards the people and the Earth. One way is true cost pricing and the other way is fair taxation.

1. True Cost Pricing

True Cost Pricing (TCP) is an accounting and pricing system that includes all costs into the price of a product. This would make ecologically-sound products cheaper to the consumer in terms of market price and the demand for these products would increase. Also, various cultural / traditional industries that have been marginalized by unrestrained technology could flourish.

Under our current system, many products carry hidden environmental and social costs such as air and water pollution, deforestation, and toxic waste. These costs are created during the production, use, or disposal of the products. While the producer internalizes revenue and profits from these products, the costs are externalized to society and the natural environment. In addition, many of the laws that exist to prevent environmental and social damage are not adequately enforced. Examples include smog checking of vehicles, and tobacco taxes and court settlements, which are not being used as intended. In this way, externalized costs equate to a subsidy.

TCP would account for these costs. To implement TCP, we call for:

a. Environmental taxes such as the Carbon Tax. [See carbon tax in the next section]

b. TCP to be a basis for decisions on government projects and in Environmental Impact Statements.

c. Integrate TCP into domestic industrial policies and regulations, and likewise promote it in international trade agreements.

d. Implement product labeling to inform consumers of the total cost of the product’s ingredients and manufacturing process.

e. Enforce laws that exist to prevent environmental and social damage.

f. Establish an information clearinghouse, consultant’s network, and other communication channels for the exchange of information about ecologically benign techniques.

g. Recognize that TCP may have short term impact on people of lesser financial means and implement measures to mitigate these effects.