Why are we subsidizing fossil fuels?

Editorial from Bloomberg:

https://www.bloomberg.com/opinion/articles/2023-10-16/climate-change-why-are-governments-still-subsidizing-fossil-fuels

Last year, global fossil-fuel subsidies expanded to a new record — $7 trillion, roughly 7% of global gross domestic output.
This remarkable number comes from a recently updated [assessment] by the International Monetary Fund, drawing on detailed disaggregated data for 170 countries. Rightly, it uses a comprehensive definition of subsidy, combining outright support (spending that offsets production costs) and implicit support (underpricing for environmental harms and forgone tax revenue).
Explicit subsidies have more than doubled since the previous assessment for 2020, to more than $1 trillion, thanks partly to efforts to soften the blow of higher energy prices after Russia attacked Ukraine. Implicit subsidies, some 80% of the total, surged as well — and unlike the explicit kind, they’re on track to rise further, both in dollar terms and as a share of global output, by the end of the decade.
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Why? Mostly to support the growing middle class around the world. Useful and, of course, governments like to be popular.

DB2

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Ayup. Every time the price of gas goes up here, the media runs out and asks people about it. The respondents invariably demand the government “do something” about it.

Steve

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