When Corporations Pollute, Taxpayers Clean Up the Mess

Dr. Jayashree Prasad-Sinha

Tax filing season was extended to May 17. Millions across the US have dutifully got their W2s, medical bills, and other receipts together to start filing their 2020 returns and calculate maximum possible deductions. For ordinary taxpayers, the gap between what is owed and what is paid is not the largest. Additionally, their tax dollars historically end up paying for the cleanup of pollutants or hazardous materials left behind by businesses or companies, many of which use bankruptcy laws to escape responsibility.

Tax dollars should be used to benefit the American people and their well-being. Taxpayers must not be forced to pay for the clean-up of environmental disasters caused by known corporate polluters. Thousands of contaminated sites exist in this country due to hazardous waste dumped, left out in the open, or otherwise improperly managed. These sites include manufacturing facilities, processing plants, landfills, and mining sites.

"There are hundreds of other toxic dumps in the US that either no responsible party has been found or money from the original polluter has been exhausted. US taxpayers end up paying for the clean-up."

Vox: How "forever chemicals" polluted America's water, August 4, 2020.

The burden of environmental cleanup on the backs of ordinary Americans is not new. It is historical and ongoing. In 1980, Congress established the Comprehensive Environmental Response, Compensation and Liability Act informally, or the Superfund. It allows the Environmental Protection Agency to clean up contaminated sites. It also forces the parties responsible for the contamination to either perform cleanups or reimburse the government for EPA-led cleanup work.

When there is no viable responsible party, Superfund gives EPA the funds and authority to clean up contaminated sites. But, since a tax that supported superfund expired in 1995, it has been continuously under-financed. There are hundreds of other toxic dumps in the US that either no responsible party has been found or money from the original polluter has been exhausted. US taxpayers end up paying for the clean-up.

"Consider Piney Point, Florida, where residents were forced to evacuate after 200 million gallons of toxic wastewater leaked in at the former phosphate plant in Palmetto."

In 1984, Summitville Consolidated Mining Company, Inc. (a subsidiary of Canadian-based Galactic Resources Ltd.) acquired land in Colorado to extract gold. The mining operations were finished in October 1991, while leaching continued until March 1992, when Galactic Resources filed for bankruptcy. After the company insolvency proceedings were completed in a British Columbia court, the US government declared the site a superfund cleanup site and US taxpayers spent $250+ million in public funds for cleaning up the site.

Climate Reality: Climate Health Connection Environmental Pollution, May 30, 2019.

There are several examples of recent costly cleanups. Consider Piney Point, Florida, where residents were forced to evacuate after 200 million gallons of toxic wastewater leaked in at the former phosphate plant in Palmetto. Or Dallas, where the city approved a $450,000 contract -- using taxpayers' dollars -- to remove a massive mound of shingles and roofing materials piling up. And in Brooklyn, New York the cleanup of the toxic Gowanus Canal is estimated to be more than $1 billion by its conclusion by 2023.

"In his [Robert Doyle Bullard], book, 'Dumping in Dixie: Race, Class, and Environmental Quality,' he asks the rhetorical question: 'Should risks be borne by a smaller group to spare the larger groups?'"

Tax dollars collected by the US Treasury pay for all Federal and State provided services. The Treasury also pays the compensations of senators, representatives, and qualified members. Elected members earn a comfortable salary with benefits, including medical coverage. At the same time, low-wage earners hold about 40% of US jobs (based on the March 2021 Job Quality Index data). CEOs of companies are paid in millions -- still, working-class citizens have no reprieve.

During a recent Senate Finance Committee hearing, IRS commissioner Charles Rettig told the Senate Finance Committee that the gap between federal taxes owed and paid "could approach and possibly exceed $1 trillion per year," more than double the official estimate of $441 billion. Underpayments of approximately $175 billion come from the wealthiest Americans, according to IRS research.

"Hard-earned US tax dollars should be used to support and improve the livelihood of Americans. The current system leaves taxpayers accountable when major corporations take the easy way out."

In March, Senator Elizabeth Warren (D-MA) introduced her Ultra-Millionaire Tax Act, to which billionaire Leon Cooperman reportedly told CNBC that the rich would simply hide their assets.  At a recent hearing called Creating Opportunity Through a Fairer Tax System, Warren invited Cooperman to testify. He declined.

Now This: How Air Pollution Exposes America's Racial Disparities, July 25, 2020.

Robert Doyle Bullard, called the "Father of Environmental Justice" and is now Distinguished Professor at Texas Southern University, said in a 2005 interview, "There is no level playing field. Any time our society says that a powerful chemical company has the same right as a low-income family that's living next door, that playing field is not level, is not fair." In his book, Dumping in Dixie: Race, Class, and Environmental Quality, he asks the rhetorical question: "Should risks be borne by a smaller group to spare the larger groups?"

Hard-earned US tax dollars should be used to support and improve the livelihood of Americans. The current system leaves taxpayers accountable when major corporations take the easy way out. To rectify this inequity where citizens bear the burden of environmental cleanups, each US representative and senator needs to act on behalf of the American people and look after the interests and well-being of their constituents in legislative sessions.