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A lot of it is due to the odd use of the word subsidy in this and similar articles. Say an oil company spends $50 producing a barrel of oil, sells it for $80 a
by tim333 2y ago
A lot of it is due to the odd use of the word subsidy in this and similar articles.
Say an oil company spends $50 producing a barrel of oil, sells it for $80 and sends half the difference, $15 to the government in tax. On the definitions in this article the government is likely subsidising the oil production because they are likely "take a tax deduction for a large portion of their drilling costs" and not billing for the pollution effects. But in everyday language they are taxing not subsidising oil production.
And then what should the government do? If they ban drilling or double the tax they lose the tax revenue and jobs.
- tim333 2y ago>...a government fails to make an industry pay for damage it causes, such as air or water pollution, that also amounts to a subsidy. Thinking about that one, there are a lot of bacteria that break down vegetation releasing CO2 and the government fail to tax them! Stop subsidising bacteria! Actually I prefer the old fashioned definition of subsidy - money paid to industry is a subsidy, money extracted is a tax even if the tax calculation includes deductions.