France’s fuel protests show how poor people can bear the cost of fighting climate change

The true cost of green policies.
The true cost of green policies.
Image: Reuters/Eric Gaillard
We may earn a commission from links on this page.

More than a quarter-million French people took to the streets on Saturday (Nov. 17) to protest a rise in fuel prices tied to the government’s new carbon tax. Wearing the yellow vests required in every vehicle in France in case of a road accident, protesters attempted to block major thoroughfares across the country in order to draw attention to a list of grievances that coalesced around calls for president Emmanuel Macron’s resignation.

Saturday’s “yellow-vests” protests were the culmination of months of anger at the government’s efforts to target car pollution and put in place environmentally friendly fiscal policies, a hallmark promise (link in French) of Macron’s campaign for president. While the protests were mostly non-violent, 106 people were reportedly injured, and one protester was killed (paywall) when a driver accidentally rammed their vehicle into a crowd. Close to 300 people (link in French) were arrested across the country, and 28 law enforcement officers were injured.

In an age of growing popular angst over the negative environmental impact of globalization and calls for government action on climate change, this weekend’s protests in France show that governments can pay a price when they choose to act—and that the heaviest burden of environmentally friendly policies is often borne by society’s least prosperous.

Carbon tax and green policies in France

Since his election in May 2017, Macron has positioned himself as a leader on environmental issues, spearheading negotiations around the Paris Climate Accord, launching the “Make our planet great again” initiative to fund research on climate change, and telling world leaders at the “One Planet Summit” that the time had come to begin the transition to a greener economy.

But Macron has not been able to reconcile the urgent demands of environmental activists with the needs of working class people who say that environmental protection policies infringe on their livelihood. In August, environment minister Nicolas Hulot resigned because he said he felt the government’s policies on climate change were insufficient. On the flip side, in December 2017, Macron sparked a public backlash by escalating a set of green fiscal policies initiated by his predecessor, François Hollande, that included a carbon tax of €44,60 ($51) a ton (paywall). The tax is set to increase to €65,40 in 2020, and €86,20 in 2022 (links in French).

In France, the carbon tax is added onto the Internal Consumption Tax on Energy Products, which applies to companies that produce, import, and/or store fossil fuel. Typically, those companies pass on those taxes to consumers, by increasing the price of the fuel they sell. In recent years, carbon taxes had less of an impact on consumers, thanks to low global oil prices. But now that oil prices are back up, consumers are feeling it in their wallets. For example, diesel prices rose 6.2% between Jan. 2017 and Jan. 2018 (link in French). Poor households spend a larger proportion of their income on gas and transportation than wealthy ones, and so the carbon taxes have hit poor and rural workers especially hard.

In May, an online petition calling on the government to reduce gas prices garnered more than 900,000 signatures. Working class people have taken to social media to voice their discontent. One such video (link in French), recorded by 51-year-old hypnotherapist Jacline Mouraud, was viewed more than 6 million times on Facebook. In it, she rails against some of the anti-pollution measures put in place by the Macron and previous administrations, like a partial ban on diesel cars built before 2001 and a proposal to create tolls for cars entering large urban centers (links in French). “When is it going to end,” she asks, “this hunt for drivers?”

Why environmental policies disproportionately impact the poor

Pollutants from burning diesel are connected to thousands of deaths every year (link in French) in France, and yet it remains the most commonly used fuel in the country. Fiscal policies that make fossil fuels like diesel more expensive have been shown to be effective in reducing this kind of deadly air pollution. In a landmark climate report published in October, the United Nations’ Intergovernmental Panel on Climate Change recommended the use of carbon pricing measures like carbon tax or cap-and-trade programs to slow the steady rise of global temperatures. And William D. Nordhaus, one of the two winners of this year’s Nobel Prize in economic science, advocates for a global carbon tax, which he argues (paywall) is “the most efficient remedy for the problems caused by greenhouse-gas emissions.”

But carbon taxes disproportionately harm poor people. Their effects are now being felt in consumer prices for the fossil fuels that power the cars many low-income people in rural areas rely on to get to work every day. For this demographic, even a small hike in prices makes a difference.

Thanks to systemic inequalities that determine who gets to live in “clean” areas, low-income households around the world already suffer most from climate change. But they also suffer more from policies that seek to reverse climate change: A 2011 working paper published by the National Bureau of Economic Research found that forcing emitters to buy carbon permits (public licenses that allow companies to emit a certain amount of pollutants into the air) causes a rise in the price of electricity, heating fuel, and gasoline, which disproportionately impacts poor families.

However, as David Roberts writes in Vox, “We can design a progressive carbon tax if we want one.” Research has shown (pdf) that governments can offset some of the economic burden of green policies like carbon taxes by reinvesting the income from those taxes into social subsidies for low-income families. And that’s what the Macron government has hinted at doing. As of this year, an “environmental bonus” rebate gives French residents up to €2,500 back (link in French) if they get rid of their diesel vehicle. If they also purchase a new, energy-efficient car that emits less than 20g of carbon dioxide per km (about 17g per mile), they’re eligible for another €6,000 “ecological bonus” (link in French). And after the escalation of Saturday’s protests, French prime minister Edouard Philippe proposed to double the rebate (links in French) for low-income families who decide to trade in their diesel vehicles, and to offer a subsidy for customers who switch to clean fuel to heat their homes.

Despite these subsidies, the government has made clear that the carbon tax is here to stay. Meanwhile, the yellow vests are planning a series of new protests across France this week. For now at least, it seems neither side is budging.