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H.R.2184 – End Oil and Gas Tax Subsidies Act
- sofixa 4y ago
- cwillu 4y agohttps://news.ycombinator.com/newsfaq.html https://news.ycombinator.com/newsfaq.html “The basic algorithm divides points by a power of the time since a story was submitted. Comments in threads are ranked the same way.” Currently 32 points, in the ten minutes since it was posted. *edit: now 43 points in 11 minutes
- advisedwang 4y ago19 votes --- less than 1 in 20 people comment I suppose? Or it takes them a few minutes to type out a comment. It gets to number 1 I suppose as it got those votes very quickly. It's likely to be a hot topic if you give it a bit of time.
- sva_ 4y ago19 votes in a few minutes. Not surprising.
- atomlib 4y agoIt was upvoted a lot. It's kind of like the concept of a child prodigy: not every single one grows into something significant but performing well early gets you into spotlights.
- dheera 4y agoAsk a bunch of people to upvote? I know it's against the rules, but they're not really enforceable on a broad scale, and everyone I know who has gotten stuff to the front page did ask for upvotes, and covertly, by not sharing a direct link to HN, to avoid tripping HN's referral detection mechanisms. It's a bit of a prisoner's dilemma, it would be a nice platform if everyone didn't do that, but like many other things it tends to result in a defect-defect scenario.
- advisedwang 4y agoNeeded, but does this have any chance of passing?
- tuckerpo 4y agoNo shot. Check out the cosponsors. Not a single R in sight.
- toomuchtodo 4y agoCheck back after midterms.
- babypuncher 4y agoBut I thought R's hated government handouts
- booi 4y agoonly to poor people
- cheaprentalyeti 4y agoYeah, poor people are sooooo unapreciative when we make the cost of gas $ 4.00 a gallon. Don't they know Saint Vladimir has a war to finance?
- ars 4y agoTrue, but making sure there is enough energy is more important to them (see Europe as an example of what happens when government fails at this). Democrats also consider energy a priority, but don't like hydrocarbon fuel, so are conflicted with bills like this - I bet it won't get every Democrat on board either. Also, the current situation isn't directly a subsidy, it's a tax reduction, which is sort of a subsidy if you squint, but it's different enough. Republicans do like tax reductions.
- cheaprentalyeti 4y ago
- tmaly 4y agoGiven the current cost of corn, how about doing the same for the ethanol subsidy.
- fredgrott 4y agomaybe you do not understand how unleaded gasoline works? We add ethanol to gasoline get unleaded to gasoline so we can avoid adding lead to it to prevent knocking of engines.
- freeone3000 4y agoBut why subsidize it? Especially if we're cutting subsidies to the rest of the fuel.
- sidewndr46 4y agoThis isn't really true. You can buy unleaded gasoline that is very high octane with no alcohol. We add alcohol because it is subsidized, so it is cheap.
- tadfisher 4y agoCorrection: we add ethanol to subsidize the corn industry. It is not cheaper to do so, it is mandated by law.
- sidewndr46 4y agoI know there are various statutes including a presidential EO recently directing the EPA to require the addition of ethanol. Does the actual regulation issued by the EPA require the addition of corn-derived ethanol? Or is just ethanol?
- deleted 4y ago[deleted]
- bombcar 4y agoUnleaded non-oxy has existed forever and way predates ethanol.
- Overtonwindow 4y agoThe government could curb any behavior it wants with taxes and removing subsidies. Raise the price on gas, and the market will respond with EVs. If the tax on cigarettes were $50 then smoking would likely end immediately; I suppose a black market could emerge though.
- padobson 4y ago>I guarantee a black market would emerge immediately FTFY But seriously, this experiment is already playing out in NYC[0]. Every marginal % you tax a product, you push some number of consumers into the black market. At some point, the black market reaches a critical mass where the thing you're taxing might as well be banned. [0]https://www.google.com/search?client=firefox-b-1-d&q=new+york+city+black+market+cigarettes https://www.google.com/search?client=firefox-b-1-d&q=new+yor...
- workingon 4y agoAt some point, the black market reaches a critical mass where the thing you're taxing might as well be banned. >>> This doesn't make sense, because you're still getting taxes on the white market merch. Even if black market merch dominates, its different from prohibition where you get no taxes.
- bombcar 4y agoAt some point the cost of policing it overtakes the revenues from white merch.
- JumpCrisscross 4y ago> Raise the price on gas, and the market will respond with EVs EVs are supply constrained. Raising gas prices when the average EV is months from delivery and tens of thousands of dollars more expensive than ICE comparables is just mean.
- cheaprentalyeti 4y ago
- refurb 4y agoHow are tax benefits subsidies? That’s what all the changes are. Changes to amortization, etc. When I get a tax break with my 401k am I get a “subsidy”?
- freeone3000 4y agoTax benefits are definitely subsidizes, yes. The government is subsidizing marriages, children, and saving for retirement (as well as solar panels, owning farmland, donating to charity, and a million other things).
- nyokodo 4y ago> The government is subsidizing marriages, children, and saving for retirement Only if we don't pay any taxes in the first place and the tax benefit is a credit, or if all our income belongs to the government and they just let us keep some of it. Few companies pay no net tax and our income belongs to us and is taken away by taxes for various debatably beneficial/justifiable uses.
- refurb 4y agoSo if I increase you taxes one year, then decrease the next, I’m giving you a subsidy?
- triceratops 4y agoYes.
- malfist 4y agoYes you are. The government is saying "You don't have to pay these taxes" when it's not saying the same to something/someone else. Your 401k is subsidized.
- ska 4y agoA way of thinking about this is that taxes and subsidies are basic tools government has to encourage/discourage behaviour. Since money is fungible, tax benefits are effectively subsidies offered to productive (in the tax sense) entities. You can try and draw a line between the two but in practice it's kind of inherently fuzzy: if government takes money from company A and nominally gives it to an arts program, everyone agrees it's a subsidy. If it takes the same money and uses it to cover a shortfall due to reducing company B's tax burden (i.e. an incentive) it's pretty similar. I suspect people who really contort themselves to draw a distinction have strong views about taxation as a whole which lead them to dislike the term subsidy, and want to have it not apply to government incentives they like to take advantage of.
- talentedcoin 4y agoI find characterizing amortization schedules for high-capital-investment industries as “subsidies” very frustrating. This situation doesn’t arise because the govt is handing out freebies, but because capex on oil and gas projects is very front-loaded — it takes some time to spud in a rig, build a refinery, etc., and during that time the asset is unproductive. That’s why amortization works the way it does! It’s not the evil govt trying to prop up a supposedly failing industry …
- least 4y agoDo these subsidies go exclusively to unestablished energy firms trying to enter a market that has an unreasonably high capital requirement or are they going to massive energy corporations that can front the cost?
- DubiousPusher 4y agoMaybe I'm not understanding this due to the jargon but the amoritization schedule adjustment is just one part of this. It looks like there are a bunch of genuine subsidies affected here too.
- culi 4y agoNot only that, it's actually INCREASING the amortization schedule (for geological and geophysical expenditures) from 24 months to 7 years. So not only is the comment misleading, it's straight up wrong
- DubiousPusher 4y agoOk, as I understand, because there is an annual cap on amortization, this would mean you can effectively write off more of the investment.
- kwhitefoot 4y agoDoes someone building a chip fab get the same help?
- linuxftw 4y agoI feel like when legislation is proposed about 'right to repair' or other tech-specific topics, it's fine. This is just partisan politics, there's no reason this should be here.
- sour-taste 4y agoWhy shouldn't a policy debate over how much the US government subsidizes oil and gas be here, apart from you not liking it?
- kevinpet 4y agoBecause it's purely political and not related to technology. > Off-Topic: Most stories about politics, or crime, or sports, unless they're evidence of some interesting new phenomenon. Videos of pratfalls or disasters, or cute animal pictures. If they'd cover it on TV news, it's probably off-topic.
- cheschire 4y agoAt this point the conversation doesn't amount to much more than activism and trying to encourage people to get out and vote for their representation. Once it becomes law then it becomes intellectually interesting as the fallout is tangible. So many things like this are proposed and fail to come to fruition, especially when heavily leaning towards one specific political group, that it's not very interesting.
- TOMDM 4y agoEnergy policy is tech policy. Datacenters run on something.
- tuckerpo 4y agoA bill that could raise gas prices as a tertiary outcome and push people towards green energy (read: tech) is pretty relevant to the people that'd be browsing hackernews IMO.
- artificialLimbs 4y ago
- smm11 4y agoI thought Free Market was the thing?
- deleted 4y ago[deleted]
- culi 4y agoSince when has that ever been tried? Furthermore, when has that ever really succeeded? Free markets will end up in monopolies. And then you have things like a cigarette company suing Uruguay for their anti-smoking campaign or factories polluting rivers to make a quick buck and never have to deal with the environmental consequences of their actions
- bioemerl 4y agoThis seems like a really bad idea when we are facing mass energy shortages that threaten to let Russia tear our allies out of our sphere of influence. Yes, we need to get off of oil and gas Yes, we don't need subsidies. But wait for the war to be over and we know Germany won't be freezing, please.
- fourneau 4y agoI am a hardcore advocate for cutting oil and gas as much as possible, but even ignoring the war, the order of operations is more or less wrong. Electrify your homes, fix your grid, then cut subsidies. Do the hard parts first. (The alternative only ends up making things worse for the average person)
- ars 4y agoSpeaking of order of operations, first fix your grid, then electrify the homes. Look at California which has banned new gasoline cars in 2035, banned new natural gas hookups, and also told people to reduce electrical usage and not charge their cars!
- bioemerl 4y agoI feel like this is a false connection. The 2035 ban doesn't change the present either way and Cali has a ton of time to beef up its power grid in the meantime.
- polski-g 4y agoCalifornia won't. Just like they won't ever complete that $100bn high speed rail.
- axus 4y agoI thought it was "charge your cars at night"
- thehappypm 4y ago
- _fool 4y agoYay, my congressman continues to introduce legislation I support. It's a rare treat in our political system of "lesser evils" and obstructionism.
- ChrisLomont 4y agoThe bill was introduced on 3/26/2021, and has no further action. It's likely just posturing.
- lordswork 4y agoThere's been a recent effort to move it forward, which is how I heard about it. [0] https://www.climatechangemakers.org/issue-briefing-ffs https://www.climatechangemakers.org/issue-briefing-ffs
- ChrisLomont 4y agoIs there anything on that page about any movement in Congress? On Congress site nothing shows movement since the introduction long ago.
- legitster 4y agoThis is political suicide. There's no way this wouldn't directly and immediately affect gas prices at a time when they are already creating political turmoil. Not to mention strengthen Russia's hand significantly. I would like to hear in what possible way this is a better idea (practically or politically) than just a straight carbon tax.
- GenerocUsername 4y agocarbon tax is already a politically dead idea. Sometimes politics forces you to go a shittier route than necessary.
- shreve 4y agoThis was introduced 03/26/2021. Not sure why it's relevant enough now to be at the top of HN.
- lordswork 4y ago>I would like to hear in what possible way this is a better idea (practically or politically) than just a straight carbon tax. Why not both?
- OOIE 4y agoIs there any online forum for tech where people talk about tech instead of pretending like their one-sided political team is THE answer to all of the worlds problems despite both "teams" proving they are incompetent? If we spent half as much time thinking of what we could do as individuals instead of finger pointing, we wouldn't need government intervention at all.
- rglover 4y agoNot that I've seen but if you want to jam together on setting one up let's do it: ryan.glover@cheatcode.co. I'll even do the heavy lifting, would just be nice to have someone around and encourage engagement.
- dpkirchner 4y agoI use the "hide" button to tailor my HN experience.
- katbyte 4y agoClick the back button and move on with your life by only clicking early tech only titles?
- soheil 4y agoIt's not a tech community then if half of users engage in hot item political topics on the regular, is it?
- soheil 4y agoA place called Hackernews, however, you need a time machine.
- soperj 4y agolobste.rs
- soheil 4y agoCould you send me an invite? I promise I will only talk about tech.
- robd003 4y agoThe democrats are completely out of touch with the people they're supposed to serve. Let's hope the dems lose both the House & Senate in November so we can regain some normalcy.
- toomuchtodo 4y agohttps://www.pewresearch.org/science/2020/06/23/two-thirds-of-americans-think-government-should-do-more-on-climate/ https://www.pewresearch.org/science/2020/06/23/two-thirds-of... (Pew Research: Two-Thirds of Americans Think Government Should Do More on Climate) I support this policy, and expect my gov to lean into mitigating climate change and getting to net zero as fast as possible. If something was poisoning your loved ones, we wouldn’t be haggling over it. We’d treat it as an emergency. Same deal. It’s an emergency. Treat it as such.
- culi 4y agoActually, most of the democrats policies poll much better than the party itself. It's somewhat of a mystery why there's such a huge disconnect between how popular their policy positions are vs how well they do in the polls Abortion, healthcare, climate change, voter rights, etc. Even a plurality of people support DC statehood!
- lordswork 4y agoRecent voter surveys disagree with your remarks: >Before seeing any messaging, voters support the government eliminating tax subsidies and other financial incentives for fossil fuels by a 24-percentage-point margin (54 percent support, 30 percent oppose). Democrats support this proposal by an overwhelming 52-point margin (70 percent support, 18 percent oppose), while Independents support it by a 15-point margin (49 percent support, 34 percent oppose). While Republicans are nearly split, they oppose it by a narrow 3-point margin (39 percent support, 42 percent oppose). [0]: https://www.dataforprogress.org/blog/8/6/voters-support-ending-fossil-fuel-subsidies https://www.dataforprogress.org/blog/8/6/voters-support-endi...
- _8j50 4y agoWhat is the argument against this? Honestly asking. I do know that profit margins need to exceed cost of finding, extracting and refining the oil and US's natural gas was decimated because of saudi vs russia price wars in 2020 after covid hit because prices weren't high enough which meant shutting things down. Do subsidies artificially allow a good enough profit margine to continue operations? If so is it for crude, lng,etc...? Because if it means depending more on russia and venezuela I can see that argument being good. Also, why not get rid of farm subsidies or industry subsidies in general? Or is the point of this bill "oil bad" ? Because that would be silly, I mean sure it is bad but reducing supply just means it will be aquired elsewhere complicating the politics of switching to renewables. In other words, if the US used only its own fossil fuels it would be easier to regulate prices and such to make renewables more appealing, and russia,saudi and china getting more business means they are less motivated to reduce fossil fuel usage. But in general I agree with subsidies being a bad thing but with oil, I would rather have it in the US where we have control over the extraction and refinement process as well as distribution and ability to wind down dependence on it in a planned manner, but that doesn't mean they should be subsidized. I just don't know what the reasons are for keeping subsidies and I'm keeping an open mind.
- TEP_Kim_Il_Sung 4y agoWhy not subsidize these in reverse; By not taxing energy- and food-production in the first place?
- randomdata 4y ago> Also, why not get rid of farm subsidies Most of farm subsidies that people talk about goes towards food stamp-type programs. Not wanting the poor to starve may be a good reason. And when people talk about product subsidies (like corn subsidies) they are referring to the insurance system operated by the government. Due to the nature of what is being insured (i.e. something that is likely to affect most policy holders when disaster strikes), it is difficult for private business to provide the necessary insurance. Traditional insurance products rely on only a few policy holders needing insurance each year. When mass disaster strikes, such as a hurricane destroying homes across a wide area, the government typically does step in to cover the difference. Since this is the norm for agriculture, the government stays at the ready. Farmers still have to maintain a paid policy to be participants in the insurance system. Perhaps insurance should be abandoned, but it's generally considered a social good.
- photochemsyn 4y agoThis line in particular looks like a good move: > "Expands the definition of crude oil for purposes of the excise tax on petroleum and petroleum products to include any oil derived from a bitumen or bituminous mixture (tar sands), and any oil derived from kerogen-bearing sources (oil shale)." Seems like the industry got its lobbyists to write in a loophole, and that loophole should be eliminated.
- taxman22 4y agoIf you have high "ordinary income" from salary, RSUs, NSOs, etc, you can essentially convert that ordinary income to dividends and long term capital gains using these oil & gas tax subsidies. Let's say you invest $100k into a drilling fund. You can deduct intangible drilling costs in year 1, which is usually about 95% of your investment. So you save ($maginal_tax_rate * 95k) in year 1, and get a dividend (with extra tax break) of 10-20% per year for about 7-10 years. When the oil slows down after 7-10 years, the fund sells the asset for 20-30% of your investment, and I believe you can realize that loss.
- obblekk 4y agoWhat does this mean: "repeals the tax deduction for tertiary injectant expenses" ? If I'm an oil driller and I spend $25 on "tertiary injectants" to produce $200 of oil, my real income is $175. So, the government should only be taxing me on $175. Does this deduction mean simply that? Or is it an extra bonus deduction allowing me to claim $200 - $25 - $25 bonus = $150 income? If it's just a normal allowed expense, then why is the government even involved in deciding which of my expenses are legit (beyond fraud levels)? If it's a bonus expense that counts twice, then why was this even passed in the first place? Politics aside, I'm getting a strong "chesterton's fence" feeling here - we're removing something that sounds like it shouldn't exist in either scenario, without understanding what led it to exist in the first place...
- yyyk 4y agoThe general idea behind these kinds of bills is to do supply-side management of fossil production: reduce oil production is order to help with pollution/global warming. This sounds alluring but in reality, the same demand exists - it's just being directly or indirectly satisfied by imports from less scrupulous countries, usually dictatorships or theocracies. Inasmuch as there's an effect on demand, it's a very slow one. The proper way to limit fossils is at the demand side, even if this plays less to the view of oil companies as the ultimate villains.
- toomuchtodo 4y agoPrice of oil goes up, demand for EVs and other non fossil energy uses goes up. Demand will only go down when you make consuming fossil fuels economically painful. No one is going to voluntarily leave cheap energy in the ground unconsumed/non combusted. You must continue to drive down the cost of clean energy and using that clean energy for work (mobility, battery storage for grid balancing and energy arbitrage, etc).
- yyyk 4y ago>Price of oil goes up, demand for EVs and other non fossil energy uses goes up. Also prices of every thing in the economy goes up, including EVs and non-fossil energy. Eventually we just substitute local production with imports from various bad actors. Besides, EV production is no longer limited by demand, but by availability of batteries. >Demand will only go down when you make consuming fossil fuels economically painful. Demand can be lowered by mandating fuel savings and some mild taxation. Sometimes even just asking (like a recent UK campaign did) helps. >No one is going to voluntarily leave cheap energy in the ground unconsumed/non combusted. The lower demand is, the less economic to extract. >You must continue to drive down the cost of clean energy and using that clean energy for work (mobility, battery storage for grid balancing and energy arbitrage, etc). Yes, we must keep plugging away at this. But IMHO supply side manipulation of fossils is not effective anymore, and has significant downsides.
- toomuchtodo 4y ago
- jmyeet 4y agoNote: introduced in March 2021 and hasn't made it out of committee (Ways and Means). This probably isn't going anywhere. Here's something to consider though: energy is a matter of national security. Don't believe me? Look at what's happening in Europe right now with energy shortages as a direct result of Russia cutting off the natural gas supply. The US isn't really suspceptible to this at the moment. We subsidize food production for much the same reason: the US can't be starved by external forces. I have an issue with corn subsidies in particular but having enough food is a matter of national security. Just as having enough energy is. Over-producing food means severe events like droughts and floods don't mean a large number of people will starve. If we cut anything it should be the ridiculous amount we spend on the military. We need this generation's version of the Truman Investigation Committee [1]. Some of our weapons programs are unjustifiably expensive (eg F35) and the amount of money thrown about in 2 decades of war in Iraq and Afghanistan in defense contracts and private militaries ("security companies") is disgusting. But oil and gas? LIke it or not, this is something we need and will need for some time to come. [1]: https://en.wikipedia.org/wiki/Truman_Committee https://en.wikipedia.org/wiki/Truman_Committee