Fighting Fossil Fuel’s Government Finance Freebies

Whether or not the bill passes, those sub­si­dies are worth focus­ing on. After all, we’re talk­ing at least $10 bil­lion in free­bies and, depend­ing on what you count, pos­si­bly as much as $40 bil­lion annu­ally in free­bie cash for an energy indus­try already mak­ing his­toric prof­its. If attack­ing them is a con­ve­nient way for the White House to deflect pub­lic anger over ris­ing gas prices, it is also a per­fect fit for the new world­view the Occupy move­ment has been teach­ing Americans. (Not to men­tion, if you think about it, the Tea Party focus on deficits.) So count on one thing: we’ll be hear­ing a lot more about them this year.

But there’s a prob­lem: the very word “sub­si­dies” makes American eyes glaze over. It sounds so bor­ing, like some­thing that has every­thing to do with finance and taxes and account­ing, and noth­ing to do with you. Which is just the reac­tion that the energy giants are rely­ing on: that it’s a sub­ject prof­itable enough for them and dull enough for us that no one will really bother to chal­lenge their perks, many of which date back decades.

By some esti­mates, get­ting rid of all the planet’s fossil-fuel sub­si­dies could get us halfway to end­ing the threat of cli­mate change. Many of those sub­si­dies, how­ever, take the form of cheap, sub­si­dized gas in petro-states, often with impov­er­ished populations—as in Nigeria, where pop­u­lar protests forced the gov­ern­ment to back down on a deci­sion to cut such sub­si­dies ear­lier this year. In the U.S., though, they’re sim­ply straight­for­ward presents to rich com­pa­nies, gifts from the 99% to the 1%.

If due atten­tion is to be paid, we have to fig­ure out a lan­guage in which to talk about them that will make it clear just how loony our pol­icy is.

Start this way: you sub­si­dize some­thing you want to encour­age, some­thing that might not hap­pen if you didn’t sup­port it finan­cially. Think of some­thing we heav­ily subsidize—education. We build schools, and give gov­ern­ment loans and grants to col­lege kids; for those of us who are par­ents, tuition will often be the last big sub­sidy we give the chil­dren we’ve raised. The the­ory is: young peo­ple don’t know enough yet. We need to give them a hand when it comes to fur­ther learn­ing, so they’ll be a help to soci­ety in the future. From that anal­ogy, here are five rules of the road that should be applied to the fossil-fuel industry.

1. Don’t sub­si­dize those who already have plenty of cash on hand. No one would pro­pose a gov­ern­ment pro­gram of low-interest loans to send the rich­est kids in the coun­try to col­lege. (It’s true that schools may let them in more eas­ily on the the­ory that their dads will build gym­na­si­ums, but that’s a dif­fer­ent story.) We assume that the wealthy will pay full freight.  Similarly, we should assume that the fossil-fuel busi­ness, the most prof­itable indus­try on Earth, should pay its way, too. What pos­si­ble rea­son is there for giv­ing Exxon the odd bil­lion in extra breaks? Year after year the com­pany sets record for money-making—last year it man­aged to rake in a mere $41 bil­lion in profit, just fail­ing to break its own 2008 all-time mark of $45 billion.

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