Why Do We Pay Energy Giants to Wreck Earth?

We must stop subsidizing the fossil-fuel industry.

April 5, 2012 |

To stay on top of important articles like these, sign up to receive the latest updates from TomDispatch.com here.

Along with “fivedollaragallongas,” the energy watchword for the next few months is: “subsidies.” Last week, for instance, New Jersey Senator Robert Menendez proposed ending some of the billions of dollars in handouts enjoyed by the fossil-fuel industry with a “Repeal Big Oil Tax Subsidies Act.” It was, in truth, nothing to write home about -- a curiously skimpy bill that only targeted oil companies, and just the five richest of them at that. Left out were coal and natural gas, and you won’t be surprised to learn that even then it didn’t pass.

Still, President Obama is now calling for an end to oil subsidies at every stop on his early presidential-campaign-plus-fundraising blitz -- even at those stops where he’s also promising to “drill everywhere.” And later this month Vermont Senator Bernie Sanders will introduce a much more comprehensive bill that tackles all fossil fuels and their purveyors (and has no chance whatsoever of passing this Congress).

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.