Bernie Sanders' Favorite Oil And Gas Subsidy

   Senator Bernie Sanders speaking in Concord, New Hampshire — part of a key region that
represents his favorite fossil fuel subsidy. 

What is your favorite fossil fuel subsidies? Which may seem like an odd question, but you almost certainly one. Even someone as strongly opposed to the consumption of fossil fuels such as presidential candidate Bernie Sanders is a favorite - will get shortly.

If you are wondering why there are fossil fuel subsidies despite seemingly overwhelming opposition to their existence, I'm going to explain it here. In short, it is because they require their taxpayers, but does not recognize them as fossil fuel subsidies.

Oil Change International is a company that monitors subsidies of fossil fuels, and tabulate figures often cited by those opposed to the fossil fuel industry. For example, a few years ago environmental activist Bill McKibben, founder of 350. org, stated the OCI data support that fossil fuel industry receives $ 1 trillion in annual grants.

What OCI considers a subsidy of fossil fuels? From their website:

A subsidy of fossil fuels is any government action that lowers the cost of fossil fuel energy production, raises the price received by energy producers or lowers the price paid by energy consumers. There are many activities in this simple definition - tax breaks and gifts, but also loans on favorable prices, price controls, purchasing requirements and a host of other things.

There are many things lumped into this category, but it is the kind of research that I went to the source for that total $ 1 trillion. First of all, OCI claimed USD 775 billion a year in subsidies, but said it could be higher. So McKibben and company rounded up to an even $ 1 trillion a year (more on this below). But the $ 775 billion invoke OCI, US $ 630 billion was "consumption subsidies in developing countries" and another $ 45 billion was for "Subsidies to consumption in developed countries."

Thus, 87% of the subsidies classified in tables from OCI directed at making them more accessible energy for consumers. Certainly, on the definition of any program that "reduces the price paid by energy consumers" is a subsidy. But the frames as "massive giveaway to Big Oil» activists managed to anger by ill-informed people.

Why did McKibben cite a higher figure than the $ 775 billion ischieithei OCI? It turns out that when you keep fuel costs down for consumers, higher oil prices = more subsidies. Venezuela is a classic example. Consumers there have long to pay less than $ 0.10 / gallon for gasoline. This is regulated by the government, and the subsidy is tabulated as the difference between the price paid by consumers and the market price. Higher oil prices create a major difference from the purchase price, so this giveaway »to Big Oil" - to use the words of McKibben - becomes larger.

Which brings me to Bernie Sanders. Subsidies consumption in the US, one of them relies OCI was low income home energy assistance program (LIHEAP) helps low income families with their heating bills. LIHEAP currently receives more than $ 3 billion a year in tax dollars, which are then added to the quartet of subsidies to fossil fuels. As a result, many people who hate other fossil fuel subsidies love a subsidy of fossil fuels. Like Bernie Sanders:

LIHEAP and Bernie Sanders have long synonymous in Washington and back to his home state of Vermont, where through the years, the senator has brought dollars home millions in critical heating assistance to thousands of families throughout the state of traditional Winter-Weather winter. Even while traveling in the country running for the US presidency, longtime Vermont senator and LIHEAP champion Bernie Sanders found time in 2015 to help secure $ 17 million in funding for Vermonters, proving its commitment as one of the greatest champions program in Congress.

Yes, I suspect that the LIHEAP is actually subsidizing Bernie Sanders favorite fossil fuels.

Now before Bernie Sanders defenders come out of the woodwork, I understand that I am not critical for the support of LIHEAP. I'm sure Hillary Clinton also supports LIHEAP. Count me among those who do not want to see people freeze, because they can not afford fuel. What I resent is that spent billions of tax dollars to help people with their heating bills, but that dishonest or misinformed people who paint as a giveaway to Big Oil. The irony is that in many cases, are screaming the loudest for ending oil subsidies are some of the staunchest defenders of LIHEAP.

For those who claim to be opposed to fossil subsidies but support programs like this, you are by definition fossil fuel subsidies. The numbers have misinterpreted again consist mainly programs designed to make fuel more affordable for consumers. Helps fossil fuel companies that sell more fuel? Yes. It's a giveaway in these companies? If you answer yes, then you suspect that Bernie is in Big Oil pocket.

Also, I do not mean to leave the impression that the fossil fuel industry does not get any tax breaks. That they do. But they are in the form of tax reductions as opposed to tax payments from the Treasury - which is what most people envision when they hear the word "subsidy". Furthermore, tax cuts make up a small fraction of the numbers being thrown around as fossil fuel subsidies - so I guess activists feel the need to exaggerate.

But the disconnect between what you think is a subsidy of fossil fuels - and what is to be regarded as a subsidy of fossil fuels - is exactly why I never go away. As argued in a previous article by Forbes, oil subsidies is not going anywhere because even Liberals love.