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Politics : Politics of Energy

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To: RetiredNow who wrote (1006)	7/26/2008 1:55:15 PM
From: Brumar89	Read Replies (1) of 86352

The oil and natural gas industry are not dependent upon government subsidies. These industries came into being w/ no government assistance at all. And they can exist just fine without any special treatment by government. Most of the subsidies people talk about are designed to make more marginal wells economic. If you took away intangible drilling cost expensing (of 70% of them), for example, such costs would still be deductible over a period of years as depreciation. The impact would be to make some marginal wells uneconomic and lower production very marginally. Ditto for all other tax provisions that benefit oil and gas production. This isn't the case with solar and wind subsidies. Here the entire industry is dependent on subsidies for its existence. And we pay hundreds of billions per year to secure those oil supplies for them. Our oil companies don't produce in most ME countries - the exceptions are a handful of emirates and lately, Libya. They do buy oil from those countries but they're passive customers. Any stimulus for domestic production doesn't apply there.

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