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Thread: Fossil fuels subsidised by $10m a minute, says IMF

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by donsutherland1 View Post
    I finally had a chance to read through the study. A number of points:

    1. The paper makes numerous assumptions (all of which are spelled out) and concedes that some of its methodologies and assumptions "may be subject to large uncertainties and controversies." One example might be its figures based on traffic accidents. While the fuel might change, if a cleaner fuel allows for at least the same intensity of driving as is presently the case, there would be little accident-related savings.
    2. The paper's approach for estimating the subsidies based on estimated externalities is a fairly common methodology.
    3. The paper attributes only 22.3% of the total subsidies (pre- and post-tax) to climate change-related effects and 46.0% to local air pollution (particulates, etc.).
    4. The paper also employs sensitivity analysis to "test" sets of scenarios. Based on reducing/increasing estimated air pollution damages by 50%, the post-tax subsidy would range from 4.7% to 8.3% of global GDP vs. the baseline estimate of 6.5% for 2015.

    Having said that, IMO, the analysis isn't sufficiently complete for a comprehensive policy shift. It arrives at a figure for the extent of subsidies based on externalities. What it fails to do is to robustly examine the full impact on global GDP for the status quo (baseline) vs. alternative scenarios (though some other work is emerging in this area). For example, coal (no surprise given its air pollution intensity) accounts for the largest share of subsidies. If all coal usage were eliminated (a reasonable medium or long-term goal, but not practical in the short-term), there would be insufficient energy substitutes at present, leading to an energy price impact and global economic impact. ...
    My criticisms include (but are not limited to):

    1) Whenever a paper chooses to use a particular lexicon of terms, and an arguable framing, it will be viewed as prejudicial its not going to create trust in its claims. For example, the so-called "subsidy" to fossil fuels is not, in common language, a real subsidy (payment) to fossil fuel providers. More accurately, it is a social-economic cost created by the fossil fuel users (not providers) on 'the commons'.

    2) However, the costs (real or imagined) that are imposed on the commons, are usually offset by the benefits are also given to the commons. In other words, in the aggregate, the commons is indirectly "paying" for its own use of the environment and social commons. Of course, such 'payment' by the commons is in the form of worse health, economic costs, or decreased quality of life for some, but it also increases the quality of life for many others.

    And remember that many others already "pay" for their benefits indirectly because of government mandates which make them pay more for products and services than they need-want to, e.g.; the car owner has to pay more to purchase cars that meet mandated MPG and pollution standards, and as such they suffer a financial and consumer preference loss-cost.

    3) Of course, an efficient market allocation of costs requires those who use the commons to pay for damages and use of the commons. However, it also requires that government cease its mandates and regulations of those who fully reimburse for said damages (costs). Rest assured, those who want a carbon or pollution tax on gasoline don't want to give up the power to mandate more costly transportation.

    In short: there is nothing wrong with pointing out that agriculture and forestry, utilities, transportation, waste management, construction, and manufacturing cause the most of the gross environmental damage, BUT also be reminded that they are also the most heavily regulated and mandate bound. In fact, freeing them from such mandates make a lot of sense IF they are required to pay a tax for damages AND if that tax actually goes to those damaged (not the pocket of the government).
    Last edited by maxparrish; 05-19-15 at 05:59 PM.

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by Henry David View Post
    I think he's really saying "I don't want to hear about this". There is a chance that cognitive dissonance is coming into play.
    Without cognitive dissonance the left would fail to exist.

    Based on empirical evidence the theories on global warming aren't conclusive and causes haven't been proven. The Earth's warming and cooling cycles have occurred over the last 4.5 billion years revealing similar natural phenomenon, like accelerated amounts of carbon dioxide in the atmosphere.
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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by Fenton View Post
    I'm posting facts, your'e pretending you know more than the German Government AND the German Finance Minister

    Tell me , where is all this funding for Germany's Green revolution supposed to come from ?
    Oh the irony there lol. Figures lie and liars figure. Go figure
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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    But I can't understand why you call it a debacle. That since 1990 Germany have steadily decrease their CO2 output at the same time they have had a good economical growth compared to other developed countires, That you can see in this graph.

    http://energytransition.de/files/GET...missions_l.png

    That yes the decline stoped temporarily because they stoped using eight nuclear plans after Fukushima. But in 2014 the decline countinued and renewable energy is planned to countinue to grow.

    http://www.dw.de/renewables-help-cut...ons/a-18176835

    You can of course argue that it was bad to close down nuclear power .But nuclear power plant is dependent on goverment assistance and the goveremant willingness to take risks. That no power company I know of can afford to pay insurance that cover all the cost from a nuclear meltdown. As I understand it power company that own nuclear plants don't even have insurance to cover the cost of dismantling nuclear plants and long storage of nuclear materia if they go bankrupt. Something they really need because the cost of dismantle nuclear plants and long storage of nuclear material will be a huge cost for goverment to pay for if power companies go bankrupt and their are no money left to cover those cost.

    Also you have not provided any links to your claim and no link to refute my links about the declining cost of solar power. Here is some more links about the decreasing cost of renewable energy.

    http://www.aweablog.org/falling-cost...street-report/


    http://www.reuters.com/article/2015/...0L020720150127

    http://cleantechnica.com/2015/01/29/...2-years-heres/

    Also of course it can be problems with new energy sources like solar power that need to resolve. But those problems are nothing compared to the problems and cost of being dependent of oil fron Middle east. Think of how USA and UK overthrowed the democratic Iran goverment because the goverment wanted to nationalized the oil industry and increase the cost of oil in 50:s. You also have had the first oil crises in 1973 and the Iranian revolution and the resulting energy crisis in 1979. Then you had the costly Gulf War. Then you had 9/11 their most of terrorist came from one of the worlds biggest oil producer Saudi Arabia and their Saudi Arabia both before and after the atack was accused of being one of the worlds biggest funders of fundamentalists and terrorist organizations. After that you had the Iraq war. To today then ISIS is both taking over and profiting from oil fields.
    Last edited by Bergslagstroll; 05-20-15 at 05:32 AM.

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by maxparrish View Post
    My criticisms include (but are not limited to):

    1) Whenever a paper chooses to use a particular lexicon of terms, and an arguable framing, it will be viewed as prejudicial its not going to create trust in its claims. For example, the so-called "subsidy" to fossil fuels is not, in common language, a real subsidy (payment) to fossil fuel providers. More accurately, it is a social-economic cost created by the fossil fuel users (not providers) on 'the commons'.

    2) However, the costs (real or imagined) that are imposed on the commons, are usually offset by the benefits are also given to the commons. In other words, in the aggregate, the commons is indirectly "paying" for its own use of the environment and social commons. Of course, such 'payment' by the commons is in the form of worse health, economic costs, or decreased quality of life for some, but it also increases the quality of life for many others.

    And remember that many others already "pay" for their benefits indirectly because of government mandates which make them pay more for products and services than they need-want to, e.g.; the car owner has to pay more to purchase cars that meet mandated MPG and pollution standards, and as such they suffer a financial and consumer preference loss-cost.

    3) Of course, an efficient market allocation of costs requires those who use the commons to pay for damages and use of the commons. However, it also requires that government cease its mandates and regulations of those who fully reimburse for said damages (costs). Rest assured, those who want a carbon or pollution tax on gasoline don't want to give up the power to mandate more costly transportation.

    In short: there is nothing wrong with pointing out that agriculture and forestry, utilities, transportation, waste management, construction, and manufacturing cause the most of the gross environmental damage, BUT also be reminded that they are also the most heavily regulated and mandate bound. In fact, freeing them from such mandates make a lot of sense IF they are required to pay a tax for damages AND if that tax actually goes to those damaged (not the pocket of the government).
    To the bolded.

    In the United States, credible estimates of annual fossil fuel subsidies range from $10 billion to $52 billion annually yet these don’t even include costs borne by taxpayers related to the climate, local environmental, and health impacts of the fossil fuel industry. As of July 2014, Oil Change International estimates U.S. fossil fuel subsidies at $37.5 billion annually, including $21 billion in production and exploration subsidies.
    Killing one person is murder, killing 100,000 is foreign policy

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by Montecresto View Post
    To the bolded.

    In the United States, credible estimates of annual fossil fuel subsidies range from $10 billion to $52 billion annually yet these don’t even include costs borne by taxpayers related to the climate, local environmental, and health impacts of the fossil fuel industry. As of July 2014, Oil Change International estimates U.S. fossil fuel subsidies at $37.5 billion annually, including $21 billion in production and exploration subsidies.
    The subsidy fossil fuels get relative to the cost per KwH of the power they generate is hundreds of times less than that for renewables and a tiny fraction of the value of what they produce

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by Henry David View Post
    Though I am currently registered Republican, the idea that conservatism and common sense go hand-in-hand is rather an illusion.
    Indubitably.
    Killing one person is murder, killing 100,000 is foreign policy

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by Montecresto View Post
    To the bolded.

    In the United States, credible estimates of annual fossil fuel subsidies range from $10 billion to $52 billion annually yet these don’t even include costs borne by taxpayers related to the climate, local environmental, and health impacts of the fossil fuel industry. As of July 2014, Oil Change International estimates U.S. fossil fuel subsidies at $37.5 billion annually, including $21 billion in production and exploration subsidies.
    First, the impacts you speak of is not from the fossil fuel industry - it is almost entirely due to those taxpayers (and the 47 percent of non-taxpayers) who use fossil fuel in their business, job, or home. It's rather disingenuous for a consumer to blame an industry for their choice to consume.

    Second, whether or not those numbers you assert reflect real subsidies is problematical. Many, or most, so-called subsidies are actually legitimate forms of credits and deductions.

    Third,

    But much more important, the critics ignore that these fossil-fuel subsidies are almost exclusive to non-Western countries. Twelve such nations account for 75% of the world’s fossil-fuel subsidies. Iran tops the list with $82 billion a year, followed by Saudi Arabia at $61 billion. Russia, India and China spend between $30 billion and $40 billion, and Venezuela, Egypt, Iran, U.A.E., Indonesia, Mexico and Algeria make up the rest.These subsidies have nothing to do with cozying up to oil companies or indulging global-warming skeptics. The spending is a way for governments to buy political stability: In Venezuela, gas sells at 5.8 cents a gallon, costing the government $22 billion a year, more than twice what is spent on health care.


    http://www.forbes.com/sites/timworstall/2013/11/13/renewables-get-25-times-the-subsidy-that-fossil-fuels-do/


    Last edited by maxparrish; 05-20-15 at 12:11 PM.

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by maxparrish View Post


    First, the impacts you speak of is not from the fossil fuel industry - it is almost entirely due to those taxpayers (and the 47 percent of non-taxpayers) who use fossil fuel in their business, job, or home. It's rather disingenuous for a consumer to blame an industry for their choice to consume.

    Second, whether or not those numbers you assert reflect real subsidies is problematical. Many, or most, so-called subsidies are actually legitimate forms of credits and deductions.

    Third,



    http://www.forbes.com/sites/timworstall/2013/11/13/renewables-get-25-times-the-subsidy-that-fossil-fuels-do/


    [/FONT][/COLOR]
    This 47%??????

    But the American people might be on to something. In a poll conducted for NBC and the Wall Street Journal, three-quarters of respondents favored "eliminating tax credits for the oil and gas industries." Specifically, 47 percent said they found such cuts "totally acceptable" and 27 percent said they found it "mostly acceptable."

    Budget hawks: Does US need to give gas and oil companies $41 billion a year? - CSMonitor.com
    Killing one person is murder, killing 100,000 is foreign policy

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    Re: Fossil fuels subsidised by $10m a minute, says IMF

    Quote Originally Posted by Montecresto View Post
    This 47%??????

    But the American people might be on to something. In a poll conducted for NBC and the Wall Street Journal, three-quarters of respondents favored "eliminating tax credits for the oil and gas industries." Specifically, 47 percent said they found such cuts "totally acceptable" and 27 percent said they found it "mostly acceptable."

    Budget hawks: Does US need to give gas and oil companies $41 billion a year? - CSMonitor.com
    I.

    So you are telling us that the "income tax free loader" and tax payer want to punish gas and oil companies BECAUSE of they are unwilling to be be held responsible as the purchasers and consumers of gas and oil...the ones that do the polluting?

    Frankly I would not have thought anyone would have the chutzpah quote the polling of the mob's prejudices as evidence being "on to something", other than as an example mass man's inability to see beyond the hobe-goblinization of those that provide them the means to live in the age of electricity - how terrible .

    As I said "the (environmental) impacts you speak of is not from the fossil fuel industry - it is almost entirely due to those taxpayers (and the 47 percent of non-taxpayers) who use fossil fuel in their business, job, or home. It's rather disingenuous for a consumer to blame an industry for their (own) choice to consume (its' products).".

    II.

    Your cite of the CSM is a good illustration: without an honest definition of the meaning of a real "subsidy" and an understanding of who actually get's a subsidy then any broad claims by the fossil fuel haters is bogus and disingenuous posturing. The article tosses around words like "tax breaks" and makes broad and unsupported claims of 41 billion (or more) in subsidies - the author never bothering to detail or explain how he arrives at this number.

    Most likely the author (like Obama) is speaking of broadly available tax provisions are not fossil fuel subsidies. For example, there is the Section 199 deduction, which goes to all domestic manufacturing. A producer of clothing, roads, electricity, water, and many other goods produced in the United States are all eligible for the manufacturer’s tax deduction - including music and movie production. Whether or not domestic producers should get this credit is a matter of opinion, but Oil and Gas are no more "subsidized" by this deduction than other US producers.

    In fact, Oil/Gas is already targeted for special punitive tax treatment. Congress has already imposed frozen the deduction at 6 percent when other manufacturers receive a 9 percent deduction. In other words, they are targeted for tax increases compared to other domestic producers.

    Another example is in foreign tax credits and the deferral of foreign income. The FTC and deferral are two a part of a system that prevents the U.S. corporate income tax from double taxing—and further harming—the international competitiveness of U.S. companies. Foreign tax credits and deferral of foreign income is not unique to the oil industry, but it is often lambasted as a "subsidy" for "big oil" as if it were unique to the oil industry.

    Finally, there is the depletion allowance - which is a depreciation for an asset such as the amount of unknown recoverable oil from a well. Independent oil and gas producers use a depletion allowance to recover capital investments, which is also used in mining, timber, geothermal steam, and other natural deposits. Whether or not the credit rate is appropriate, is a matter of professional dispute. But it is not a special "subsidy" to the gas/oil industry.

    The fossil fuel haters keep the print and internet press rolling with lots of lurid claims, throwing everything into a stew of "subsidy". Whether or not some (or any) of it is an actual subsidy that is given to the oil/gas industry is an entirely different matter.
    Last edited by maxparrish; 05-20-15 at 02:56 PM.

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