The House of Ecstasy

I moved to San Francisco in the mid-1970s. My first job there was working for a non-profit research group with offices just where North Beach and Chinatown intersect. Our single big scruffy room was on the second floor of a building on a tiny pedestrian alley right across from City Lights Bookshop.

Costa Rica

On the first floor of the building was Specs Bar. According to the Internet, the bar still allows pets, has cheap drinks, eccentric patrons, and a snack consisting of a hunk of cheese and Saltine crackers. We were incredibly nerdy impecunious do-gooders researching stumpage rates and coal severance taxes. Next door to us on the second floor was an establishment called the House of Ecstasy.

To my knowledge, none of us ever went through that door, we were way too afraid. But in the late afternoons, when we tumbled down the hidden back stairs directly into the bar, we'd sometimes encounter a cluster of young women in their bathrobes. Drawn by the ability to get a pitcher of beer and the aforementioned cheese platter for a total of one dollar, we debated and argued while furtively looking at the marvelously exotic creatures at their own table across from us. To my knowledge, they never looked at us, and no words were exchanged.

Philippines

This cultural non-clash went on for the many many afternoons we tenanted the bar, a real testimony to the robust power of nerd shyness.

Speaking of robust power, I want to return for a moment to what we were researching in those days: coal severance taxes. A severance tax is placed on a substance as it is extracted. There being no internet, we actually sent nerds-in-training out to the wild west to collect this information. They'd travel to every country seat in the states that produced coal, get the tax ledgers, and copy the numbers down. Back in our offices, when we weren't downstairs in the bar, we took turns transcribing the numbers from wrinkled yellow legal pads into tabulation forms, loaded into our typewriters. Electric typewriters were as high tech as we got.

We gathered this information to see the effect of taxes on how and where coal was produced - the intersection of taxation and environment. Even at the time it seemed kind of obscure.

Nowadays, this kind of study is back in fashion. Sciguru (http://www.sciguru.com/) is reporting on a University of California study that looks at changes in the power grid and the use of taxation to "decarbonize" our electricity supply.

Paraguay

These folks have real computers and serious funding, but an important segment of their research is the same as ours was 35 years ago: how what we do can change according to how we change price.

The price of coal, which contributes about 20% of the carbon causing climate change, not to mention the mercury and list of other poisons that are emitted, can be manipulated. I learned three things about energy taxes all those years ago that I think still apply:

1. Extracted energy is highly manipulated in pegging its cost. There are many tax subsidies for extractors and for others in the energy production chain, like railroads and power plant operators. Those interested parties and their patron politicians howl about how carbon taxes are a bad thing, but they rarely acknowledge and never complain about their many special tax subsidies.

China

2. Many of the costs of burning coal to produce electricity are externalized - not counted in the price. These range from destruction of land to air and water pollution to severe health effects from discharged toxins and other pollutants. Cheap coal is subsidized by every single one of us in what we pay for health care, for example. Therefore carbon taxes, when structured the right way, are really just moving some of the real cost of energy onto a different column of the ledger sheet.

3. Carbon taxes and severance taxes are inherently regressive. The UC study shows how the West could reach 54% of the current carbon production from "only" a rise of 20% in the cost of electricity. For Mitt Romney - or Al Gore for that matter - the electric bill going up 20% is not a noticeable expense. But for this country's millions of poor people, the pushing of another cost onto their backs is real hardship. An injustice.

It may be that we can deal with part of the climate change crisis by adjusting how we price coal, although our almost magical belief in the power of "the market" to fix social problems is often overblown. But once again we see how the influence of big money in our politics damages our lives. The huge companies that extract coal, transport it, and burn it are all active in the purchasing of political clout, resulting in the special tax breaks they enjoy. Poor people, who get sick from pollution disproportionately and pay proportionately higher percentages of their incomes in taxes - are now scheduled to bear an even greater burden in cleaning up other people's mess.