Re: Lottery $$ for Brownfields in the UK -Reply

["Peter B. Meyer" <pbmeye02@athena.louisville.edu>]

I believe Bruce Klafter missed Tony's point - the issue is not diversion
of education-oriented Lotto programs to brownfields but rather the
structuring of a brownfields-oriented game.

Lotteries are, by their nature, means for the state to avoid taxing for
public purposes. Given all I have ever read about the people who play
the games, the "success" that the games enjoy results from sales to
gneerally lower income players. Thus, taken as a quasi-tax instrument,
the Lotto games are regressive taxes. 

That said, it says a lot about the politics of "new labour" in the UK
that they would move in this direction, unless they are simply diverting
the utilization of National Lottery funds from regressive uses to the
provision of more greanspace and cleanups for urban areas. Clearly the
UK party is not confronting any issues of the "polluter pays" nature.

I have argued elsewhere that it is almost impossible to make the
polluter pay for past contamination - the current corporate
shareholders, who might pay in lower share prices if fines or other
costs are imposed, are not necessarily the people who owned the compnay
and benefitted from its past contamination when the dumping occurred. 

But we can take an aggregate societal look at the issue of past
contamination: most advanced industrial societies grew much faster over
the past century or more by virtue of the fact that none of them
diverted profits to pollution mitigation; instead, profits were more
likelyt to be reinvested. Having more profits each year to reinvest
means that the economies enjoyed a higher rate of compound growth and
thus enjoy higher per capita incomes today than they would have had all
contamination been treated as it occured. Thus, in some sense, all the
residents (or citizens) of a modern industrial economy have benefitted
from the past contamination - and should pay for it. 

So, if the polluter pays principle should apply to cleanups, then the
public sector might logically be asked to pay -- and we need not wait
for the courts to force private parties to pay before we proceed with
cleanups. However, if the public pays, the issue of how the funds for
the cleanup are to be raised becomes central ...

 ... and we are back to the issue of a brownfield lottery.  If the past
gains that rose current incomes are the reason the public sector should
pay, then it logically follows that those members of the public who
gained the most from the past pollution should pay more than those who
gained less. This is an argument for at least a proportional tax, if not
a progressive one - and suggests that a regressive tax such as a Lotto
game represents is a formula for increasing inequality and injustice,
whether or not it could raise any funds...

-- 
Peter B. Meyer
Professor of Economics and Urban Policy
Director, Center for Environmental Management
 and Environmental Finance Center
University of Louisville
426 W. Bloom Street / Louisville, KY 40208
(502) 852-8032    Fax: (502) 852-4558