Green incentives
looking for a remedy for economic recession, unemployment, climate change and resource depletion? Try ecotax. That's what the new German coalition government is planning to do. Come April 1, the entire manufacturing sector might have to pay ecotax.
Advocates and supporters of an ecological tax reform like Ernst Ulrich von Weizsaecker, president of the Wuppertal Institute for Climate, Environment and Energy, Germany, strongly believe that the wise use of green fees can help solve many problems of highly-industrialised countries. And pioneers will reap additional benefits, thanks to their technological lead, they argue. But implementation proves to be difficult. At least one pioneer, the German coalition government, is facing a heavy barrage from many people and unions, which threaten to clobber the whole concept of ecological tax.
On the face of it, the idea of using market instruments like the ecotax system to support environmental objectives is convincing.
Ecologically-harmful factors like fossil fuel and nuclear energy, toxic chemicals or the use of water and other resources are being made more expensive. The revenue, thus generated, will be used to reduce social welfare fees shared by employers and employees, compensating them for increased production or energy costs. Economic growth will be stimulated by forcing industries to develop energy efficient products, resources will be saved and new jobs created. Economically, it makes more sense to make energy "unemployed' rather than people, says Weizsaecker. Increasing productivity of resource use gets priority over increase in labour productivity.
A step-by-step increase in the green fees over a period of time would allow the industry to adjust to higher costs by introducing new, environmental-friendly technology and thereby improving energy efficiency.
Making a headway With around four million people registered unemployed
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