Study: U.S. Fossil Fuel Subsidies Exceed Pentagon Spending

[JonLP24]

Study: U.S. Fossil Fuel Subsidies Exceed Pentagon Spending
The world would be richer and healthier if the full costs of fossil fuels were paid, according to a new report from the International Monetary Fund

TIM DICKINSON
MAY 8, 2019 4:48PM EDT



Jim Lo Scalzo/EPA/REX/Shuttersto
The United States has spent more subsidizing fossil fuels in recent years than it has on defense spending, according to a new report from the International Monetary Fund.

The IMF found that direct and indirect subsidies for coal, oil and gas in the U.S. reached $649 billion in 2015. Pentagon spending that same year was $599 billion.

The study defines “subsidy” very broadly, as many economists do. It accounts for the “differences between actual consumer fuel prices and how much consumers would pay if prices fully reflected supply costs plus the taxes needed to reflect environmental costs” and other damage, including premature deaths from air pollution.

These subsidies are largely invisible to the public, and don’t appear in national budgets. But according the the IMF, the world spent $4.7 trillion — or 6.3 percent of global GDP — in 2015 to subsidize fossil fuel use, a figure it estimated rose to $5.2 trillion in 2017. China, which is heavily reliant on coal and has major air-pollution problems, was the largest subsidizer by far, at $1.4 trillion in 2015. But the U.S. ranked second in the world.

https://www.rollingstone.com/politics/politics-news/fossil-fuel-subsidies-pentagon-spending-imf-report-833035/amp/

[mahina]

1. How can subsidies not appear in budgets?

Can that be true?

Thank you for the article!

[Recursion]

2. Because in this case the "subsidies" are spending we *aren't* doing right now

It's a kind of stupid definition of "subsidy".

The amount of fossil fuels we're burning this year would require $6 trillion (or whatever) to sequester, so that's being counted as a $6 trillion "subsidy" to the industry.