The Economist, fossil fuel subsidies and ‘climate disaster’


Guest essay by Andy May

I’ve been a subscriber to The Economist for years. It is one of the few mainstream media publications I still read. But, I found a very annoying article in the October 1, 2016 issue. The title and link are “Notes from the undergrowth.” It starts out with a false assertion that is easily debunked, but often stated:

Media myth #1

“DESPITE deluges in the South, droughts in the West and fires throughout national forests this year, the words “climate” and “change” have seldom been uttered together on the campaign trail.”

The UN World Meteorological Organization (WMO), Nature magazine, and the IPCC all have said extreme weather cannot be reliably linked to climate change.

From the WMO:

“There were fewer deaths, even while exposure to extreme events increased as populations grew and more people were living in disaster-prone areas. According to the 2011 Global Assessment Report, the average population exposed to flooding every year increased by 114 per cent globally between 1970 and 2010, a period in which the world’s population increased by 87 per cent from 3.7 billion to 6.9 billion. The number of people exposed to severe storms almost tripled in cyclone-prone areas, increasing by 192 per cent, in the same period.”

Yes, you read that correctly. There were fewer deaths, even though the number of people exposed to serious storms increased.

From the IPCC SREX report on climate change and extreme weather:

“Long-term trends in economic disaster losses adjusted for wealth and population increases have not been attributed to climate change, but a role for climate change has not been excluded…”

Hardly an endorsement for man-made extreme weather. Here is another quote from the same report:

“There is medium confidence that some regions of the world have experienced more intense and longer droughts, in particular in southern Europe and West Africa, but in some regions droughts have become less frequent, less intense, or shorter, for example, in central North America and northwestern Australia”

Finally, from the Nature editorial:

“Better models are needed before exceptional events can be reliably linked to global warming.”

So, pretty easy to completely destroy the initial statement of the article. But, we aren’t through yet, later in The Economist article we read the following:

Media myth #2

“An important step [toward lowering carbon dioxide emissions] was unveiled last year: The Clean Power Plan. This proposes the country’s first national standards to limit carbon dioxide emissions from power plants … Legal challenges from fossil fuel groups and two dozen mostly Republican-led states saw the Supreme Court put it on hold …”

This is almost true as written, but very slanted. There are only 50 states and 27 of them are against this plan by the President and the EPA, an agency that has no congressional oversight. Thus a majority of the states and the Supreme Court ruled against it. We are a republic with a division of powers. The Economist continues:

“Mrs. Clinton is vague about how she would pay for [green energy], but slashing fossil-fuel subsides could be part of the answer. Such handouts came to nearly $38 billion in 2014.”

There are very few, if any, fossil fuel specific subsidies in the United States. The most recent and well researched study of energy subsidies in the US is by the EIA, it was completed in 2015. According to this EIA report total federal energy subsides for energy in the US declined from $38B in 2010 to $29B in 2013. So The Economist mixed up total energy subsidies in 2010 with fossil fuel subsidies and got the date wrong. Of the $29B, the EIA claims 12% went to fossil fuels and 68% went to renewables, including hydropower, nuclear, solar and wind. The remaining 21% went to energy assistance for low income families, mainly through the LIHEAP (Low Income Home Energy Assistance) program. It is interesting that the EIA has computed that fossil fuels produced 84% of the energy consumed in the world in 2012. They forecast that in 2040, fossil fuels will still produce 78% of the world’s energy. In 2012, excluding nuclear, renewables (including biofuels which are mostly wood and dung) produced 12% of the world’s energy. Table 1 summarizes the subsidies discussed in the EIA report.


Table 1, 2013 energy subsidies according to the EIA

The so-called fossil fuel subsidies

Most of the fossil fuel “subsidies” listed by the EIA are not specific to the fossil fuel industry. They are not direct payments to the companies, government loans, industry specific tax “loopholes,” mandates to buy fossil fuel products, or tax deductions for purchasing fossil fuel products (except possibly the alternative fuel mixture deduction, which expired in 2013 anyway). The much larger subsides to wind, solar, and biofuel companies include all of the above. The EIA totals $3.4B in fossil fuel subsidies. The 2016 G20 US self-assessment of fossil fuels tabulates a total fossil fuel subsidy of $8.1B (page 16, Table 1). But, they include LIHEAP and the domestic manufacturing deduction which we consider invalid.

The EIA report only includes what they call “financial interventions and subsidies” that are provided by the federal government and targeted specifically at energy. This seems logical, fossil fuel subsidies or energy subsidies should not include general tax provisions like the domestic manufacturing deduction. This deduction, often listed as a fossil fuel subsidy, is for all manufacturing companies. Gasoline, diesel, ethylene, etc. are manufactured just like cars and televisions. They do not include this provision in this list and they shouldn’t. Also not included are accelerated depreciation (except for the 15-year natural gas pipeline rule), local infrastructure projects like highways, and state and local incentives to get businesses to move to a specific location.

There are other tax provisions often called subsidies, that the EIA wisely did not include. One is the foreign tax credit, especially the dual capacity rule. Another is the publicly traded partnership, used by pipeline companies, cable companies and real estate companies. These are available for all companies and are widely used outside the energy sector. These tax provisions are obviously not energy subsidies. They are large amounts, so they are often used to pad the headline subsidy number.

State and local incentives are not included either. These are mostly for renewable energy. A lot of the local incentives are conservation oriented.

Finally, often lumped in as a subsidy are various safety funds, like the Black Lung Disability Trust Fund, the Nuclear Waste fund, the oil spill liability trust fund, etc. The various funds listed here (there are more listed in EIA report) are funded by the affected industries and have no budgetary impact. Including them (as some do) is the same as taking the payments made by the energy sector and calling them subsidies. How does a company subsidize itself?

Arguing that the tax law favors oil and gas is a little silly because according to the New York Times corporate tax database (2007 to 2012) ExxonMobil, Chevron and ConocoPhillips paid the most taxes overall. The overall average tax rate for the S&P 500 is 29%, oil and gas companies pay 37%. They do not provide numbers for coal, unfortunately. You will see people twist and distort these numbers to fit any agenda they like. The NY Times database is pretty complete and includes all taxes actually paid, so I tend to believe it over other statistics I’ve seen. Some try and say taxes do not affect corporate decision making, which is total nonsense, the NY Times article also makes this point. Reading about this makes one see the wisdom of a flat income tax with no deductions at all.

Of the EIA total fossil fuel subsidy of $3.4B, $0.5B is from the IRS deduction for costs spread over the productive life of a well or mine. The percentage depletion deduction has been in the tax code since 1926. It is available to all mining companies (gold, copper, iron, etc.), small oil and gas companies and royalty owners of oil and gas properties. It is not available for large integrated oil and gas companies like ExxonMobil. Calling this general deduction, that large oil and gas companies are not permitted to use, a fossil fuel subsidy takes big cojones. Under some circumstances, the percentage depletion allowance can exceed the costs of a well or mine. This was deliberate on the part of Congress; they did not want small wells or mines shut down just because of our tax laws. Most wells and mines in the US have very low rates of production and would be closed if this tax provision were eliminated.

Another $0.5B is due to expensing of exploration and development costs, this includes intangible drilling costs (engineering, site preparation, research, etc.). These are legitimate business costs that every other business is allowed to deduct. This provision has been in the tax code since 1913. Again, as with the percentage depletion deduction, large oil and gas companies are specifically singled out to receive a reduced deduction. This is analogous to the development cost for a new drug. The pharmaceutical industry is allowed to deduct research and development costs. It is extremely difficult to call this a subsidy.

The credit for investment in clean coal costs the government $0.2B. This can reasonably be counted as a fossil fuel subsidy. It is specifically for the coal industry. It is the same as wind or solar subsidies, just much smaller.

Other so-called subsidies include treating natural gas pipelines as 15 year properties, amortizing geological and geophysical expenses over two years (equivalent to research, enjoyed by every company), treating coal royalties as capital gains (they aren’t?), and partial expensing of mine safety equipment. These total $0.3B. None sound like a subsidy.

My favorite fossil fuel subsidy is the “Alternative fuel mixture credit” of $0.4B. This applies to natural gas and hydrogen fueled vehicles. I guess it could be called a subsidy and part of it, probably the largest part, is for natural gas. This provision expired at the end of 2013.

In 2013 there was a temporary tax deduction still in effect that allowed 50% expensing of some refining equipment. That amounted to $0.6B. It expired at the end of 2013.

The tax provisions that are called coal subsidies are all related to deductions for installing pollution control equipment or enhancing mine safety. These add up to $0.8B. These are not provisions I would call subsidies, they are reasonable cost recovery for following government regulations.

The largest so-called fossil fuel “subsidy” is the Low-Income Home Energy Assistance (LIHEAP) welfare program. Obviously, in the northern United States winters energy is a life and death matter. When it is 40 degrees below zero outside you need heat to survive. If you live in the north, on the next windless cold night, think about that. I’m sure you will be in favor of fossil fuels then. This is worth $5.4B, more than all of the “subsidies” listed above. The EIA correctly did not call it a fossil-fuel subsidy, but many do. LIHEAP applies to all sources of energy, including renewables.


It’s sad when a major news publication writes an article containing “media myths” that are so easily proven wrong. Unfortunately, this is occurring with increasing frequency. Googling “climate change and extreme weather” on my computer resulted in 4,630,000 hits. Glancing through these shows that many of them state something imprecise, unfalsifiable and non-quantitative like “some extreme events seem to be increasing and this might be due to climate change.” Or, like the EPA, “climate change is increasing the odds…” Quantitative studies like Roger Pielke Jr’s, show that there is no data to support the idea that extreme weather has increased in frequency or severity. As he says, this media-myth of a connection between extreme weather and climate change is “Zombie science.

These subsidy claims are actually an indictment against our tax laws. They have become so complex that they can be twisted to support any conclusion. This is the real problem and the tax laws are way overdue for reform. The bottom line is that fossil fuel companies (at least the oil and gas companies) pay more in taxes than the average S&P 500 company and they are getting few, if any, special tax breaks. The fossil fuel companies get no government loans, loan guarantees, guaranteed prices, or special tax breaks for any of their products. The only energy companies that get targeted subsidies are wind, solar, biofuel and other renewable energy companies.

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October 8, 2016 8:01 pm

You might have just linked to the extreme weather page on this site:
But it is lacking the global drought graphic, which is trending down.

Reply to  J. Philip Peterson
October 8, 2016 8:37 pm

I guess the global drought graphic is there, but my browser wouldn’t open it…JPP

M Seward
October 8, 2016 8:31 pm

Really, what do you expect from a magazine titled “The Economist”?
To an economist monetizing the inputs and outputs of energy is core business to create a new case study for their models. “Climate Disaster” just gives them a eye catching name or subtitle to market their modelling.
This has nothing to do with eality this is to do with content creation and publishable paper manufacture. Both are already monetised and therefore rational in the world of economics, i.e. there is a market for them. The fact that the market is one in the field of intellectual bling, more like the market for tobacco products ( ‘when only the best will do’ etc) and other sorts of social botox for narcissists, is beside the point.
To prostitute rather than just paraphrase Descartes, “It sells therefore it is”.

J McClure
Reply to  M Seward
October 8, 2016 9:02 pm

I feel your post pain, yet we all know the Solution is hydrogen. Follow the money and discover why “they” are nothing more than wankers. The quote should be “I am therefore I am” ; )

Reply to  J McClure
October 9, 2016 4:48 am

Popeye said it best: ‘I am what I am’. 🙂

Reply to  M Seward
October 9, 2016 9:53 am

Excellent analysis.
Bottom line: find out the views of the responsible editor and you will be able to predict with some accuracy the bias you’ll find throughout that media outlet.
As long as Geoffrey Carr – Science Editor since 1995 and someone I’ve had conversations with over the past decades, and a textbook case of the soft-Left elite network – remains in that slot, the Economist’s reporting on climate matters will continue to reflect the views of the alarmist wing of the climate establishment. Couched in the “serious” “non-nonsense” overall tone of The Economist.
I have simply stopped reading any article in The Economist related to climate. I’ve also pointed out to them that their lack of credibility on that topic undermines their credibility on other subjects, but clearly to no avail.

patrick bols
Reply to  M Seward
October 10, 2016 11:04 am

to my regret, The Economist (I am a reader for over 40 years) is led astray by one of their science editors who clearly bought in to the climate change idiocy. I believe that they ought to be more carful in taking position on a controversial scientific matter. This is not the first time they support Gore’s theology.

Steve Heins
October 8, 2016 8:34 pm

EPA’s Clean Power Plan and its Moment of Truth
By Stephen Heins
While many of us have actively tried to follow the broad-based scientific discussions about climate change including those at the Paris Meetings, most of us are stuck between to the “alarmist” and the “denier” narratives. The “luke warmers,” as we are called, suspect that the climate change discussion is far from over.
Most troubling to some observers of the current Washington DC bureaucracies, the FCC and the EPA, is that they fit the classic mold of federal agencies furiously trying to regulate industries while they themselves are many years behind the investment, technology and innovation of the industries they regulate.
Suffice it to say, the world’s 7.4 billion people of global economy and planetary environment are far too important to be left to silo thinking or national and global politics. This is especially true with the skyrocketing need for big data, huge wireless broadband and ongoing technological innovation, particularly in the under-developed and under-represented parts of the world.
With that in mind, here are several flaws in the final version of the Clean Power Plan (CPP) of 2015:
• The use of several studies (e.g. Harvard’s study of indirect health benefits) are likely examples of “study-bias;”
• Medical computations of indirect health benefits from the reduction of PM 2.5 (or fine particulate matter) have never been well demonstrated;
• The CPP places complete faith in the advancement of technology responding to political dictates instead of the marketplace;
• The CPP lacks a full accounting of the costs of stranding electrical assets and the large investment in new infrastructure, which essentially just replicate old distribution assets;
• The Clean Power Plan has never been properly vetted by the states, and there never was a state or national political mandate calling for its formulation;
• Currently, a clear cut democratic majority, 28 states, have officially challenged the legality of the Clean Power Plan;
• With the U.S. Court of Appeals for the District of Columbia just beginning its En Banc proceedings, President Obama and Secretary McCarthy are likely to be in the rear view mirror by the time it is fully litigated;
• Indistinguishable from any political campaign, the robust public relations campaign conducted by the EPA and the White House, and a large number of related texts and emails, are shrouded in the lack of proper disclosure not unlike the Colorado Toxic Spills;
• Actual greenhouse gas reductions from the Clean Power Plan are miniscule, and, according to Scientific America and the Energy Information Administration (EIA), by 2015, 47 states had already achieved sharp decreases in emission from 2007 levels, with more than billion tons of reductions;
• The US is already on a glide path whereby America has reduced more Green House Gas (GHG) than any other country in the world, a fact which even the Sierra Club acknowledges;
• The EPA has never provided a real cost benefit analysis of the Clean Power throughout all versions of the regulations;
• The CPP gives the EPA and state environmental agencies first class status, making all other state and federal agencies (like the Department of Energy, Federal Energy Regulatory Committee, and State Utility Regulators) virtual second class citizens, with second class powers;
• With “cross state” and regional emission differences, the CPP makes states and regions compete against each other in energy markets previously regulated by states, and is de facto helping to create a national emissions market, which has already been defeated legislatively;
• The Clean Power Plan is fraught with backward looking and silo thinking, with no heed paid to the rapidly expanding convergence of energy, technology and wireless telecommunications. In the case of the above convergence, there is no consideration for the rapidly expanding need for electricity, big data and wireless broadband to allow significantly more energy efficiency, better environmentalism and economic development in all 50 states;
• The CPP has a serious lack of transparency, whereby much of the information remains undisclosed. Much of the grant money provided by the EPA for health and emissions studies (Harvard, Syracuse, George Mason et al) is essentially undeclared;
• The significant input provided by large environmental groups like the Sierra Club and the NRDC is largely buried in the footnotes or hidden in private emails;
• Finally, as Professor Laurence Tribe of Harvard and the Wall Street Journal point out, the constitutionality of Clean Power Plan and its new found powers violate the separation of powers and the long standing principle of cooperative federalism between the states and the federal government.
Stephen Heins
Energy Consultant, Business Writer and Practical Environmentalist
“Proactive, precise, published”
The Word Merchant, LLC
Suite 3
530 Wilson Avenue
Sheboygan, WI 53081
920-918-8098 (I Phone)

Reply to  Steve Heins
October 9, 2016 4:16 am

This has now been made a thread.

george e. smith
Reply to  rogerknights
October 9, 2016 10:44 am

I just attended, last Friday Oct 7th the University of California annual Symposium on renewable energy.
The second paper on the program was a 30 minute paper:
” Combating Climate Change and Creating a Greener and More Sustainable Economy. ”
presented by Alex Padilla, the California Secretary of State, and a politician clearly intent on advancing to the Governorship of California.
In his paper, he too Talked about “Fossil Fuel Subsidies.” and presented a slide showing those “subsidies”.
He was talking about “leveling the playing field” by eliminating Federal and presumably State subsidies for fossil fuel companies, since solar panel subsidies are going or gone.
A federal subsidy (for fossils) is simple to understand.
Each year sometime in February, the US House of Representatives prepares its annual budget to present to the President, and it includes an “appropriation” from the US Treasury of umpteen billions of dollars to be given to the “Big OIl” industry to buy oil wells and oil deposits etc. ” and other types of capital equipment needed for their business.
OOoops !! Somehow I must have read that rong.
Apparently it works differently from that. Actually, the Big Oil companies already had the money, which they got from investors who thought oil was a good business to invest in, so they anted up for those companies’ stocks. And the oil companies made a profit on their business of selling oil, so they used some of that money to look for more oil deposits, and to drill and build a well when they find some oil, and all the drilling equipment they have to buy and keep repairing, so they can stay in business.
But the gummint won’t allow the Big Oil companies (or any other business) to simply write off those expenditures on oil searches, and well drilling and well equipment purchases; Instead the MAKE those companies including Big Oil “capitalize” those expenditures.
Your oil well is going to produce oil for the next 20 years, so you can take that 20 years to recover the cost of getting that well, so you an then drill another one somewhere else, so we will only allow you to deduct 5% of your cost of the capital asset each year for the next 20 years.
Well the period for “depreciating” your asset which is wearing out in some fashion, depends on how long it is expected to last.
So that 5% of your business expense that the gummint won’t allow you to deduct in the year that you spend it, is suddenly magically morphed into a Congressional appropriation of funds from the Federal Treasury, and is now called a “Federal subsidy.”
So I’m in favor of totally eliminating ALL Federal subsidies in the form of “Depreciation allowances” for every single business enterprise.
Those companies should be forced to deduct ALL business expenses in the fiscal year in which those costs are paid.
It’s time to eliminate ALL federal and State Subsidies of businesses, including Big Oil.
In other news, Padilla made it clear that California gummint under Moonbeam Brown and his Democrat successors (including Padilla in time) are driving fast forward to 100% renewable Clean energy in California, and also to complete 100% electrification.
They propose new building codes, requiring all new construction to be 100% electrified.
No more gas heat or gas hot water or gas stoves. My 97 year old MIL who is a good cook, says it is impossible to cook good food with electricity; you have to have a gas range, even if you don’t use it for hot water or home heating.
A later after lunch paper by David Hochschild, a Commissioner on the California Energy Commission, also was on electrification. “Sunrise from the West: California Moves Toward a 100% Clean Energy Future. ”
Incidentally Alex Padilla made it clear that the green weenies who pressure him to promote fossil fuel elimination from California, are equally adamant that they also mean NO NUKES.
There actually were some good real energy papers.
Best one was the first Keynote paper by Umesh Mishra, Professor of Electrical and Computer Engineering, UC Santa Barbara : The Development of GaN-based Power Electronics for PV Inverters- The Important BoS cost Driver .”
UC SB is the home of Shoji Nakamura, who invented Blue LEDs and lasers, and the Cerium Doped YAG White LED System (460 nm Blue LED plus CeYAG yellow phosphor.
I had a big long talk with him. They are working on Gallium Nitride high Power Semi-conductors, operating at 1,000 to 1200 volts and Temperatures up in the 400 to 600 deg. C. At those Temperatures, you can combine GaN solar cells with thermal collection of near IR solar spectrum energy, with a coolant system for the solar cells (Operating at hundreds of suns irradiance by means of efficient non-Imaging Optics).
Prof Roland Winston of UC Merced (actually in Atwater) is the inventor and world leading expert on Non-imaging optics, used for efficient solar collection as well as solid state (LED) lighting.
UC Pres , Janet Napolitano, previously Arizona Gov, it fully committing the entire UC system, all campuses to extensive work in renewable energy.
A lot of money is going to a lot of dead end projects at ALL of the UC campuses.
Roland and his crew at UC Merced, are doing some practical and useful things, which is why they invite me to their shindig each year.

george e. smith
Reply to  rogerknights
October 9, 2016 4:33 pm

Clarification: I had a big long talk with Professor Mishra who presented the paper on GaN power Devices. It reads below, as if I had a big long talk with Dr. Nakamura. I have done that a year or two ago, but he wasn’t at Friday’s symposium.
Sorry for the misgrammation there.

Ron Abate
October 8, 2016 8:36 pm

Like so many other mainstream publications, The Economist has turned into a rag. Don’t read it anymore. I suspect part of the problem is the retirement of a more sensible, less brainwashed and ideological writing staff, who have been replaced by a less intelligent, more brainwash and ideological writing staff.

Reply to  Ron Abate
October 9, 2016 3:45 am

Unfortunately, you may be correct.

Joe Crawford
Reply to  Andy May
October 9, 2016 10:51 am

Worst than that, it now applies to more than just the “mainstream publications.” It looks, at least to me, like our entire culture here in the U.S., both professional and personal, is being slowly taken over by the “brainwashed and ideological.” Of course maybe I’m just getting too old and curmudgeonly to understand all of the exceptional benefits of the modern society.

Shawn Marshall
Reply to  Andy May
October 10, 2016 4:19 am

Thanks or a great debunking; fact filled and plain. Kudos.

R. Shearer
Reply to  Ron Abate
October 9, 2016 7:10 am

Yes and all government subsidies to “rags” and other propaganda outlets should cease.

Reply to  Ron Abate
October 9, 2016 8:17 am

who have been replaced by a less intelligent, more brainwash and ideological writing staff…..nope, they work for less, cheaper

Chris Schoneveld
Reply to  Ron Abate
October 9, 2016 9:27 am

The problem is that economy is not an exact science but belongs in the category of social sciences.

Reply to  Ron Abate
October 9, 2016 5:46 pm

See my comment about Geoffrey Carr [ the Economist Science Editor for the past 20 years..]. His climate establishment alarmist ideology has been there all along, ever more visible throughout The Economist’s articles under the previous and current Editors in Chief.
While the weekly still purports to stand for a traditional free market / Stuart Mills type liberalism, in fact it is closer to UK Lib Dem or Canadian Liberal Party big government / change-through-taxation thinking than it cares to acknowledge.

October 8, 2016 8:44 pm

I was a subscriber to the Economist for over 25 years and watched its resolute drift to the left as the liberal Oxbridge mafia took over the magazine. We now have an anti-American pro globalization magazine with the hubris that anyone who does not see the world their way are fools and worse, redknecks.
Their global warming unquestioning mania is just one aspect of their infuriatingly smug world view. Cancel your subscription forthwith. Let the buggers go bankrupt.

Reply to  Vuil
October 9, 2016 1:43 am

Vuil, I disagree , because you need to kept updated on how they think. ( Yes I know how they think) You don’t have to buy the “paper” just follow their crap on the net. (for free).

Reply to  asybot
October 9, 2016 9:22 am

I agree the economist has become debased – what I might term establishment group think. But I suspect I will resubscribe. My own professional body the ICAEW has fallen for the CAGW meme big time and I will probably resign as a result. You would have thought auditors may have some ability to challenge falsehoods based in suspect data, but apparently not.
[ICAEW is what group? .mod]

Reply to  asybot
October 9, 2016 12:48 pm

“you need to kept updated on how they think.”
That’s one of the main reasons I continue to subscribe. It’s been fascinating to watch the way that all the mainstream publications have been transformed over the past 10-20 years. It really is an Invasion of the Body Snatchers experience.

Peter Miller
Reply to  Vuil
October 9, 2016 1:45 am

Agree 100%.

Reply to  Vuil
October 9, 2016 10:37 am

I’m a current subscriber to the magazine. But I’m dissatisfied with them and I’m planning to drop my subscription when it expires at the end of the year. For one thing the magazine is full of factual errors. They don’t seem to have anyone on staff double-checking their facts. For example a few issues back they had an entire article about Puerto Rico’s impending financial default that was based on a faulty understanding of American bankruptcy law and the sovereign rights of American states. For another things there is so much bias that you simply can’t trust them.
Two small examples from this weeks issue (October 8th): (1) Page 8 – An unnecessary and out of context insult of Donald Trump, calling Phillipine President Rodrigo Duterte “The Trump of the Phillipines.” The article wasn’t even about Donald Trump. (2) Page 30 – The dabate pitted Hillary Clinton’s running mate, Senator Tim Kaine of Virginia, against Mr. Trump’s sidekick, Governor Mike Pence of Indiana.” Gosh, one is a running mate and the other is a sidekick!
These are just two small examples that I found especially irriatating in this week’s issue. I’m sure if I took the time I could find much more. But you probably get the point. I’m dropping my subscription because I simply don’t trust them as a news source any longer.

Reply to  Marty
October 9, 2016 9:16 pm

I hope you and others who drop their subscriptions will take the time to in form “Dear Sirs” exactly why you are doing so. If enough people vote with their feet, the publishers just might do so some soul searching.

Reply to  Marty
October 9, 2016 9:17 pm


Reply to  Vuil
October 9, 2016 5:27 pm

I didn’t realise it was news that The Economist had drifted way off course to the left. It’s been that way for many a year.

Reply to  Vuil
October 13, 2016 6:32 pm

I am informed that astrology can be shown by statistical analysis to be a more effective predictive science than economics.

October 8, 2016 8:53 pm

Gave up on The Economist years ago. Originally dedicated to free markets and individual liberty, it has become the exact opposite.
And as you just discovered, the quality of argument is mediocre.
Footnote: the excellent Matt Ridley was once its science editor. Wonder what he thinks of his former employer now.

Reply to  Chip
October 9, 2016 3:47 am

My original draft had the final sentence: “I miss Matt Ridley.” in it. After your comment I wish I’d left it in.

Matt Ridley
Reply to  Chip
October 9, 2016 4:46 am

I could not possibly comment…

Reply to  Matt Ridley
October 9, 2016 4:52 am

Actually, please say more, Matt. Thank you for doing your best.

October 8, 2016 8:56 pm

I believe you have missed a rather large subsidy. The Ethanol Blending Subsidy. This is an amount paid to oil refiners to entice them to blend bio-ethanol from corn into their gasoline runs. It is sizable.
My view is that it is really subsidy to the alternative fuels industry and to agriculture, for without it, the demand for ethanol, and therefore, corn, would be lower.

Reply to  Stephen Rasey
October 8, 2016 10:37 pm

Ted Cruz was the only one against this in Iowa, but he won Iowa in the primaries. Trump wanted to increase the corn ethanol subsidies…

Reply to  Stephen Rasey
October 9, 2016 4:07 am

It is in the biofuels category, the EIA also calls it a renewable subsidy which it is. Some have tried to call it a subsidy to the fossil fuel industry before.

R. Shearer
Reply to  Andy May
October 9, 2016 7:23 am

Yes, in most cases it is a nuisance and added expense that oil companies and refiners don’t want. A few refiners have moved to produce some ethanol and biodiesel, so that they can take advantage of the subsidies, renewable investment credits, etc. However, when all of the accounting is done correctly, greater CO2 emissions are the result of all this meddling.

Reply to  Stephen Rasey
October 9, 2016 7:34 am

And how much does the decrease in gas mileage help the Big Oil as a subsidy? It is similar to mandating that Maple Syrup must add 10% water (sweetened by an artificial sweetener or some such chemical) and then charging more for it.

October 8, 2016 8:59 pm

Weather is like communism if all things are equal. It doesn’t have the same level of extremes if the temperature gradient/delta doesn’t exist. Simply put, in a warming world, they shouldn’t exits as much theoretically. Think about it.
Just sayin……

John F. Hultquist
October 8, 2016 9:05 pm

Try Smithsonian Magazine. Usually it is better for your blood pressure.

South River Independent
Reply to  John F. Hultquist
October 8, 2016 10:58 pm

Tried it for a year, then stopped. It too is a liberal rag.

James Beaver
Reply to  John F. Hultquist
October 10, 2016 1:11 pm

Smithsonian is no better. My wife likes the stories, so she keeps renewing it … over my objections.

J McClure
October 8, 2016 9:17 pm

Excerpt from the referenced link:
“Uncoupling emissions growth and economic expansion is important to slowing climate change. Total energy consumption in America has dropped 1.5% since Barack Obama became president, according to the White House; in that time the economy has swelled by 10%. America now generates more than three times as much electricity from wind, and 30 times as much electricity from solar, as it did eight years ago.”
This is complete BS!

J McClure
Reply to  J McClure
October 8, 2016 9:19 pm

How many ways can we spell post-normal logic?

J McClure
Reply to  J McClure
October 8, 2016 9:33 pm

So post normal science is a “thing” – I get that part. Post Normal logic <–'I'm thinking Skeet Shooting ; )

Reply to  J McClure
October 9, 2016 7:49 am

The economy has “swelled” by 10 percent in 8 years? Oh wow, anymore of that rate of growth (while borrowing 10 trillion or so) and we will disappear as a world power. And what percentage of the reduction of CO2 was due to conservation and Nat gas, and what to renewables? Complete claptrap.

Reply to  Taylor Pohlman
October 10, 2016 7:46 am

As Pyrrhus might have put it:
“Another such growth period as this and we are undone!”

Samuel C Cogar
Reply to  J McClure
October 9, 2016 8:51 am

Quote from above: “America now generates more than three times as much electricity from wind, and 30 times as much electricity from solar, as it did eight years ago.”
Well now, iffen they were not producing any electricity from solar 8 years ago, …… then they would be producing
100% more solar today than they were 8 years ago.
Like the claim about “97% of all climate scientists” ……… was only in reference to 76 individual.

Reply to  Samuel C Cogar
October 9, 2016 2:24 pm

The DOE annual report contains the following true but misleading statements:
Between 2005 and 2015, electricity generation from solar increased 48 fold, from 550 GWh to 26,473 GWh.
Biomass increased 18.3% from 54,277 to 64,191 GWh, and geothermal increased 14.1% from 14,692 to 16,767 GWh. (Biomass is “wood” and “waste” in the graphs.)
Such statements encourage pro-renewables media to brag without revealing that the 48 fold increase of a near-zero value is still very little, as is the 18.3 and 14.1 percent; both are seen in the graph as essentially horizontal lines. The DOE statements are further misleading for omitting to report the decrease in hydro in the same period, a decrease that outweighs the sum of the others many-fold. The overall decline in that very decade is not revealed.

Reply to  Samuel C Cogar
October 13, 2016 6:34 pm

Thirty times sweet FA is as near as dammit not much different to sweet FA…

Reply to  J McClure
October 9, 2016 1:07 pm

Growth by 10% in eight years is “swelling”?
To keep this a family-friendly site I shall refrain from the obvious joke.

October 8, 2016 9:21 pm

The Economist was once famous for its triangulation of facts, all from reliable independent and verifiable sources, which are then written into the text. These facts were triple checked by sub-editors. This rarely occurs at news agencies today, except Wikinews, a citizen journalism site, which has software that requires this rigorous triangulation approach to every story. As it is a voluntary news service, no one wants to write for it. Occasionally, I assign my students the task, and they admit that Wikinews is a tough but excellent learning process, with the required ethical obligation of accuracy once enjoyed by readers of The Economist.

October 8, 2016 9:35 pm

Regarding Table 1 counting nuclear and conservation as renewables: How is conservation a source of renewable energy? Meanwhile, I followed the EIA link and saw the PDF, and they don’t count nuclear or conservation as renewables. Probably because nuclear fuels are limited and not renewable, although in better supply than fossil fuels. And because conservation is not an energy source – it is a reduction of demand which allows nonrenewable supplies to last longer.

October 8, 2016 9:37 pm

Over a period of very few years, the Economist went from reasonable commentary on the cost/benefit of various mitigation strategies, to full on endorsement of post-normal science. That was IIRC, over a decade ago. Haven’t picked it up since.

October 8, 2016 9:45 pm

Count one more 35 year-plus subscriber to The Economist as now an ex-subscriber. Its statist drift had been annoying me for some time, but when renewal came up in 2011, the CAGW propagandizing had become so blatant that I couldn’t in good conscience financially support it anymore.

Timothy Price
October 8, 2016 9:51 pm

I like The Economist and have read it for years. The writers seem really knowledgeable until they write on something I know a lot about, and then I notice they seem to be as uninformed as most journalists these days.

John Harmsworth
Reply to  Timothy Price
October 8, 2016 10:12 pm

Is this meant to be humorous sarcasm? Or do you really think they only lack veracity on subjects with which you are familiar?

Reply to  John Harmsworth
October 9, 2016 4:55 am

It is sarcasm. Mark Twain once remarked about his teachers learning more and more stuff as he grew older (meaning, he finally understood them).

Reply to  Timothy Price
October 10, 2016 7:55 am

Over at TvTropes, this is known as being Dan Browned. (After the DaVinci Code author.)

October 8, 2016 9:51 pm

“It’s sad when a major news publication writes an article containing “media myths” that are so easily proven wrong. Unfortunately, this is occurring with increasing frequency. ” Sad? It happens so often I believe it’s by design. The Economist has been bought by the Marx Brothers machine like many other publications. Part of the plan. Call me a conspiracy theorist but even a cursory review of most media biases put them in the Liberal support category. The days of real journalistic ‘reporting’ are over.

Reply to  markl
October 9, 2016 12:37 pm

I think it’s a misnomer to call the media “liberal”; it’s socialist/Marxist, which is far from liberal. I’m a liberal but I’m not a Marxist.

James Beaver
Reply to  Bartleby
October 10, 2016 1:17 pm

Ah … a classical liberal. Better keep that quiet or one fine day they will come for you.

Bob Hoye
October 8, 2016 10:13 pm

The Economist has been corrupt for a long time. In the late 1960s when CPI inflation got above 1.5% and was becoming concerning it published a chart of inflation from around 1700 to then current. Rampant periods of inflation were noted as occurring when the senior currency was off the gold standard.
Then in the 1970s when inflation was becoming very serious and distressful it printed the same chart, but did not lay the cause on fiat currency. High inflation was explained as due to wars.
The official explanation required a PhD in tautology. CPI inflation was NOT due to central bank credit issuance. Get this–it was due to the public’s “inflation expectations”. Economists still go on about this.
I stopped reading it in the late 1970s when it was going on about the “European Community”.
Bob Hoye

October 8, 2016 10:46 pm

Every year I fill out the form for “locally produced goods” I enter my interest in various oil and gas wells ( a few thousand dollars) If I produced anything but oil and gas here in the USA, gravel, dental floss, whatever I would get a tax break. The next line: ” Subtract the income from oil and gas production” Some subsidy!

Joel O’Bryan
October 8, 2016 10:50 pm

I discontinued my Economist subscription 4 years ago when it became obvious they were against the mild-mannered, commonsense, good family man, honest Mitt Romney.
Imagine if you will for a minute if Mitt Romney were president today, running for re-election against Crooked Hillary, and Obama were relegated to 1 term Has-Been status with Jimmy Carter. Imagine President Romney the Mormon vs. Hillary the congential liar with a rapist husband.
Worthless rags like the Economist are why we have the thoroughly dishonest Obama now and Trump vs. Clinton are our pathetic choices.

Joel O’Bryan
Reply to  Joel O’Bryan
October 8, 2016 11:04 pm

Actually, as I ponder what today’s election would look like…. if Romney were President, the DOJ and FBI would still be doing their job and Hillary, Bill, Huma, and Cheryl Mills would be inmates in the Federal Peniteniary system for their Foundation crimes during Obama’s term.

Reply to  Joel O’Bryan
October 9, 2016 5:40 am

Well, if Trump manages to get into Office, let’s hope he investigates the entire Clinton Crime Foundation, and the entire Barack Obama administration. Lots of criminal and national security issues there for a new FBI Director to investigate.

Chris Schoneveld
Reply to  Joel O’Bryan
October 9, 2016 9:35 am

“rapist husband”? That is a typical Trump claim. As far as I know it was all consensual.

Reply to  Chris Schoneveld
October 9, 2016 10:08 am

“rapist husband”? That is a typical Trump claim. As far as I know it was all consensual.

False. One intern (Lewinsky) gave him consensual sex in the White House toilets, including cases where Clinton used the intern as a cigar humidor and receptacle. But that doesn’t count as sexual harassment, does it? An older man very rich man, the most powerful man in the US (arguably the world at the time) requesting sexual favors from a young woman intern? Nah. It’s ok, he supports abortion. NOTHING he (or she) does can be wrong!
Bill Clinton has been credibly charged by multiple married and single women of rape, intimidation, and sexual assault.
Hillary led the “bimbo eruption squad” before his elections – her name, not mine! – to slander and demean the women who publicly announced his assaults. We do not know how many dozen others remain unknown. And in fear.

October 8, 2016 11:29 pm

Rather sad and rather telling that a magazine titled ‘Economist’ cannot even discuss economics without misrepresenting some basic concepts.
There is no way that fossil fuels can be ‘subsidized’ under any useful definition of the word ‘subsidy’.
If your definition does not lead to a conserved quantity then it is a useless definition because the value of any subsidy is totally arbitrary and can be plucked out of the air.
In reality it is not possible to subsidize fossil fuels simply because they are already the cheapest source of fuel.

Reply to  LewSkannen
October 9, 2016 12:05 am

In reality it is not possible to subsidize fossil fuels simply because they are already the cheapest source of fuel.
Best one line refutation of the fossil fuel subsidy myth I’ve ever seen.

Reply to  davidmhoffer
October 9, 2016 10:45 am

Why is it impossible to subsidise the cheapest source of fuel? That makes no sense at all.

Reply to  davidmhoffer
October 9, 2016 12:14 pm

Just to illustrate, say the Govt. paid the producer of the cheapest energy $5/ MW produced. That would be a subsidy. It would result in people consuming more energy than they otherwise would without the subsidy. Fr from being a one line refutation it is nonsense.

Reply to  davidmhoffer
October 10, 2016 12:09 am

Seaice you need to understand a bit about economics and understand what money is before you are going to grasp it.
Start by asking yourself what determines the price of fuel.

October 9, 2016 12:21 am

Why do the percentages add up to 101% ?

Reply to  Jay
October 9, 2016 12:33 am

Might be round-off error but probably expanded due to climate change. Arithmetic computations were mentioned as one of the things that would get worse with climate change. I worry for the children. Won’t anybody think of the children?! etc

Reply to  Jay
October 10, 2016 6:37 am


October 9, 2016 12:36 am

In its slow drift to the left, the Economist is becoming increasingly economical with the truth.

October 9, 2016 12:52 am

My personal income tax allowance is also a subsidy from the government.

Roger Graves
Reply to  Philip Mulholland
October 9, 2016 7:24 am

Philip Mulholland says “My personal income tax allowance is also a subsidy from the government.”
No it is not. Any tax exemption is simply a decision by the government to refrain from taking money from you. A subsidy results when the government actually gives money to you, in one form or another. Giving and refraining from taking are not the same thing, a fact which seems to escape most journalists.
This inability to distinguish between the two is a hallmark of socialist thinking. From the socialist viewpoint there is no such thing as private property or private wealth; everything belongs to the State. The State may temporarily allow you the use of some money that you have earned, with the proviso that it may reclaim that money at at any time, for any reason.In a socialist world there is indeed no difference between giving and refraining from taking.
Whenever the government announces tax breaks which will benefit the rich, the mainstream media can be counted on to shriek “They’re giving money to the rich!”. Not so. They are merely refraining from taking money from the rich. The mainstream media is simply announcing its rigid socialist ideology in this manner.

Reply to  Roger Graves
October 9, 2016 9:18 am

+1 well said.

October 9, 2016 2:02 am

Ah, tales of when first grasping that the Economist is now just a rather pretentious fellow-traveller with the western ideologically righteous. In the 1980s, it loudly subscribed to the doctrine that government budget deficits of 2-3%GDP would lead to economic Armageddon for the US. These were the Reagan era deficits, employed by Democrat publications as a useful stick to beat the administration. Around 1988, it was fashionable, especially in UK organs, to say the US and USSR economies were on a par. But the USSR was on a sounder fiscal footing! Three years before the latter collapsed into economic ruin.
Of course, the past 8 years have seen federal deficits above 3% with a single exception of 1 year of 2.5% (2015). Curiously, no hint of economic disaster on that front. Indeed the Economist now sometimes seems to think a 5% deficit equals “austerity”.

October 9, 2016 3:28 am

What would an equivalent analysis for UK look like? More of the same, I guess.
OT, but the “100 months to save the planet” have expired without even a whimper.

richard verney
October 9, 2016 3:56 am

Isn’t the financial question really simple:

Does the fossil fuel industry in all its guises pay more tax to the treasury than subsidies (however defined) received? In other words are they net tax payers/net contributors to public finance.


Does the green renewable industry in all its guises pay less tax to the treasury than subsidies (however defined) received (including those paid by consumers)? In other words are they net sinks on public finance.

October 9, 2016 3:57 am

“Legal challenges from fossil fuel groups and two dozen mostly Republican-led states saw the Supreme Court put it on hold …”

Reply to  Gamecock
October 10, 2016 6:39 am

Shouldn’t the emphasis be on the merits of the case, not on the defendants?

October 9, 2016 3:57 am

We live in very troubling times. The climatocracy is obsessed with imposing power over us, and corrupting every organization seems to be their main tactic.

October 9, 2016 4:23 am

I too once subscribed. I was awed by its effortless authoritativeness and reasonableness. And its excellent writing. How it is needed now, when it is missing.

Reply to  rogerknights
October 9, 2016 6:40 am

The Economist has joined the scrap pile of publications that have been bought by various organizations and turned into a useless pile of rubbish. Sadly, I remember the days when the Scientific American was about science and not eschatology and the National Geographic was about geography and not propaganda. I used to subscribe to all three. They have long since become a content free zone.

Reply to  ShrNfr
October 9, 2016 12:50 pm

And as their respective readerships have declined to the point they’re no longer sustainable businesses, they blame the internet.

Gerry, England
October 9, 2016 4:32 am

The warmists love to confuse the difference between a subsidy where taxpayers’ money is handed out and a tax reduction where less money is snatched by government. Their other lie is to claim that renewable energy is getting cheaper when fossil fuel energy is being made more expensive by taxes.
Richard Verney makes a good point above. I think we know the answer to that one.

Reply to  Gerry, England
October 9, 2016 2:44 pm

The warmists are like the war machine propagandists, using double speak to brainwash and confuse. For instance in Syria, the U.S. is there illegally, yet it accuses Russia of bombing hospitals there yet refuses to show any evidence or even give the name and location of a hospital they said the Russians bombed. Meanwhile, many hospitals bombed in Aleppo earlier this year blamed on Russians, was done by terrorists on the ground (Al Nusra Front) using homemade cannon launchers behind tractors that throw LPG canisters. Local people took photographs at some risk and meanwhile testified to the fact there had been no planes in their skies. We have to fight this doublespeak at every moment it is used by the elite.

Reply to  dblackal
October 9, 2016 2:59 pm

Reply to  dblackal
October 10, 2016 6:41 am

Putin’s apologists are out in force.

October 9, 2016 5:09 am

I’ve spent a day thinking how much I hate the media. Over the years I’ve dropped subscriptions to magazines and the best newspaper in my country thanks to their dishonest coverage of climate change. Because of their dishonesty, I can’t bear reading them even for free. A while ago I bought a few copies of the Economist and it was also a let down.
Now I’m looking at the storm that is unleashed on Trump due to his stupid words 12 years ago. The media is on overdrive trying to win the election for a lying lowlife piece of manure, whose husband has slept with thousands of women, harassed countless of them and we hear crikets. She has blamed every woman her husband has abused and she has the temerity to be a feminist. Why did you stay with that man for tens of years and let him do that to you? Sure, Trump was not nice in that recording, but Bill is a number of orders of magnitude worse.
SO, now the media is writing about that and O’s bithing and all kinds of irrelevant idiocy instead of asking hard questions on Clinton’s corruption, her serial lying and you name it.
Thanbks to this election I had to drop WSJ too. Now I have nothing left to read, except blogs, the Quadrant etc. Thank you for ruining a whole industry!

Reply to  Vieras
October 9, 2016 6:06 am

“I’ve spent a day thinking how much I hate the media.”
You will hate the Leftwing Media even more when their machinations end up taking away your and my personal freedoms by enabling the election of Hillary Clinton.
The Leftwing Lying Media is the most dangerous organization on Earth. They are an existential threat to the United States and every other western government. We are all in great jeopardy because of these deluded, wrong-thinking Leftist who are creating a false reality in order to gain political power. Which is bad news for those who love freedom.
An aside: I don’t think everyone in the Leftwing Media are conniving, deliberate liars. There are many of those, but there are also many deluded, true-believers who don’t know any better and follow the party line. That doesn’t make them any less dangerous to our freedoms, because true believers end up decieving people, too, by parroting the party line.
One thing about it, the Leftwing Media’s popularity rating is about as low as it can go. Lower than used car salesmen. Lower than Congress. So I guess we are in a race to see if enough of the American people are going to see through the Leftwing Media Lies to prevent the election of Hillary Clinton.
These latest email releases should be devestating to Hillary, if given any coverage, but we can bet the Leftwing Media will be focused solely on Trump’s locker room talk.
Trump can turn the tables on Hillary. She has a LOT more baggage than does Trump. Trump just needs to get it out for the public to hear during the debates. Of course, Hillary and the two debate moderators will be focused on preventing any scrutiny of Hillary.
It’s time for Trump to step up to the plate and hit a home run.

Bob Hoye
Reply to  TA
October 9, 2016 7:08 am

Good one!
Trump is not the risk.
Continuation of authoritarian government is.

Reply to  TA
October 9, 2016 8:58 am

Tonight’s debate needs to be a bar fight. Trump needs to be anything but ms. nice guy. He’s going to be asked about his comments about women and he flat out needs to refuse to answercall out the moderators and the media on their hypocrisy. He needs to tell them, that he’ll be happy to answer when they ask Hillary about Bill. He needs to ask, why nobody is asking her why she is still married to a guy, who has molested at least a dozen women and probably had sex with thousands. And how she has the temerity to stand on a soap box and talk about how she is protecting women and doing this for the women, when she has always blamed every woman for Bill’s sins and done her best to destroy their lives. And when he is faced with any question about character, he needs to do the same: Why isn’t Hillary asked about how she calls police pigs and supports a racist organisation, which is dedicated at killing cops. And how she hates half the country and has no problems calling people deplorable.
He needs to say flat out, that if we are going to have a competition about character and dignity and honor here, there really is no competition. No matter what he has said or done, Hillary and Bill have done way, way worse and the media is doing its best to avoid talking about them. So, ladies and gentlemen, if these questions are going to continue to be biased and about nonsense and if you guys are continuing to protect Grandma Fragile here, I’ll be more than happy to do your work too.
Yeah, this evening needs to be about everything that the corrupt media and Queen Corruptia doesn’t want to talk about. And after we have talked about all those things, I’ll be happy to talk to you about the tape, taxes, my favourite food, you name it. But honestly, I’d prefer to talk about policy and what we need to do to this country to make it great again.

Reply to  TA
October 9, 2016 10:04 pm

You are a brave person. Thinking about the media is something that upsets my equilibrium. Indeed today’s media makes the disinformation of 1984 seem amateurish.
The recent onslaught on Trump is a case in point. The media in a frenzy while ignoring the revelations from Wikileaks that Hillary has lied about her antipathy to many issues simply to attract Bernie voters.
Agree on Quadrant. One of the last sane publications in a propaganderized world.

Tom Harley
Reply to  TA
October 9, 2016 11:27 pm
Reply to  Vieras
October 9, 2016 2:45 pm

Me too Vieras.

October 9, 2016 5:15 am

Which company pays the most taxes worldwide?

Reply to  Bill Illis
October 9, 2016 5:53 am

In the tax year 2010, Exxon collected, for governments world wide, 80 billion dollars in taxes . The company had a net profit of 30 billion dollars. Making governments the biggest takers and the reason that fuel prices are as high as they are, and that’s just what one company collected. You have to look at this way. Companies don’t pay taxes, the consumer does. You and me. So when you hear somebody or some group calling for these companies to pay more taxes. They are actually wanting them to collect more taxes from you and me.

richard verney
Reply to  Rob
October 9, 2016 11:03 am

<blockquote.Companies don’t pay taxes, the consumer does. You and me. So when you hear somebody or some group calling for these companies to pay more taxes. They are actually wanting them to collect more taxes from you and me.
In the UK there is cross political support to crack down on tax evasion and to get companies to pay more tax. the ordinary member of the public does not understand how this is an underhand method in collecting more tax from Joe Public.
I am frequently pointing out that companies do not pay tax, it is the consumer that pays this expense, and that means that every individual will have to pay more putting up the cost of living and inflation . So if you want to make Starbucks or Costa pay taxes, it will put up the price of their coffees say by £0.20p. If you want eBay to pay more tax, then listing pricing will go up, sale price will increase and maybe also paypal buying costs.
Everything will become more expensive and in today’s economic times, it is unlikely that wages will increase to cover the extra cost such that everyone will be worse off.
The job of companies is not to pay tax, but rather to employ people and employ them at a living wage. Governments would be better to address that issue rather than harking on about big corporations paying little in the way of tax.

Reply to  richard verney
October 9, 2016 11:29 am

richard verney commented: “….The job of companies is not to pay tax, but rather to employ people and employ them at a living wage. …”
And all along I thought the purpose of companies was to provide products or services and make money doing it. Who knew?

Reply to  Rob
October 9, 2016 1:06 pm

It’s constantly amazed me also Richard. I’ve never been able to understand why there’s so much heat and light wasted on “corporate” taxation. Then again, I’ve never understood socialists either. It’s possible both groups are the same and that the underlying cause is nothing more complicated than shear stupidity.

Reply to  Rob
October 10, 2016 6:46 am

The average citizen seems to believe that taxes come out of a companies profits. That if taxes went down, then the only thing that would happen would be profits would go up.
First off, this is wrong. Profit levels are set by the market. Any company that earns sub-par profits will slowly go out of business as they can no longer attract investors. Any company that earns above average profits will attract competitors, until profit levels drop back down to average.
Beyond that. These same citizens seem to believe that a companies profits only benefit rich people. However the biggest block of investors these days, are the various pension funds, followed closely by (in the US) 401ks.
That’s you and me, boys and girls.

October 9, 2016 6:34 am

Everyone laments the money in politics that poisons our representative republic, but they don’t acknowledge why it is there.
The Federal government uses our own money to manipulate, bribe, and extort its own citizens. I don’t recall seeing that spelled out in the Constitution.

Reply to  Nicholas Schroeder
October 10, 2016 6:49 am

I believe it was PJ O’Rourke who wrote that “As long as government controls buying and selling, the first thing bought and sold will be politicians.”

Reply to  Nicholas Schroeder
October 10, 2016 6:53 am

“As long as government controls buying and selling, the first thing bought and sold will be politicians.”
PJ O’Rouke

October 9, 2016 6:37 am

I’m tired of hearing wet behind the ears millennial sociologist/journalist progressives who know nothing about physics, chemistry, heat transfer, thermodynamics or how the earth heats and cools, who obviously get their science from the MSM propaganda machine and have happily downed the CAGW Kool-Aid, pontificate on global warming, greenhouse gases and the evils of modern mankind.
Without CO2 there would be no life, what kind of “pollutant” is that, and without fossil fuels we would still be living in caves.
Anthropogenic driven climate change is nothing but a faux science front for a socialistic world order agenda.

John W. Garrett
October 9, 2016 6:58 am

All industries are permitted to recover capital costs through depreciation of fixed investments. All natural resource companies ( e.g., timber, mining ) are allowed to recover the replacement cost of their raw materials through the depletion allowance. Are you referring to the deduction of intangible drilling costs? That is, of course, nothing more than a timing issue and, in any event, is only permissible for relatively small operators. The Intangible Drilling Expense deduction is only a form of accelerated depreciation ( the costs of drilling a well to casing point— like any capital expenditure— will be capitalized and subsequently depreciated if the IDE deduction is eliminated ).
“Intangible Drilling Expenses” is the capital invested in drilling a well. It (like all capital expenditures for any company) will eventually be amortized as a deductible expense (either as IDE or the depreciation deduction). Large companies are not permitted to use percentage depletion.
The demagogues fully understand that the groundlings don’t understand this stuff and are, therefore, susceptible to propaganda and sophistry.
To reiterate: the “Intangible Drilling Expense” deduction is only a form of accelerated depreciation ( the costs of drilling a well to casing point— like any capital expenditure— they will be capitalized and subsequently depreciated ).
Why shouldn’t the depletion allowance be permitted? Timber owners receive the same allowance. All owners of mineral interests are permitted to use the depletion allowance. In the oil and gas industry, it is only available to small operators.

Reply to  John W. Garrett
October 9, 2016 7:46 am

Not a tax expert, I have been told that the oil, NG, coal, whatever the fossil fuel industry has tapped into becomes the “Property” of the company that has purchased the mining rights for that fuel. That means that they will be paying “property” tax for the value of the “Property” they declared they have which they “write off” on their income taxes. So, it seems to me that the local municipalities, cities, counties, states are getting a subsidy also. However, this subsidy comes from the fossil fuel companies that are paying those taxes. Would this not be a negative subsidy? Should it not be subtracted from the so called write off subsidy?

October 9, 2016 7:18 am

Conflating a tax break with a subsidy is the new black. Shout it often enough and some might even swallow it.
No government pays for prospecting, discovery and production, but they do offer a tax break because it’s easy money they wouldn’t have otherwise had.

Reply to  fretslider
October 10, 2016 3:03 am

In a perfect world, government does not provide tax break to an industry because they have some special love for that industry. Tax breaks are applied in one part of an industry in order to stimulate development to provide for a broader tax base generally, thereby increasing the total take.
Unfortunately, lobbying by Big Business has perverted this practice to a degree, but the principle is still generally true nevertheless.

michael hart
October 9, 2016 7:22 am

Makes you wonder who or what The Economist thinks is subsidizing the vast Saudi Arabian oil industry to provide the Saudi Princes with their great wealth? Big Sand? They know it’s not the Clinton Foundation.

October 9, 2016 7:46 am

Nice article Andy, thanks.

October 9, 2016 8:07 am

Yes, you read that correctly. There were fewer deaths, even though the number of people exposed to serious storms increased.

If people are prosperous they can withstand a lot. If they are impoverished, anything will knock them down. A case in point is Haiti. More than a thousand people died because their pitiful shacks provided almost no protection. In the Dominican Republic, next door on the same island, about 26 people died. The contrast is stark.
The per capita GNP in the Dominican Republic is $11,630. In Haiti it is $1,720.
More prosperity is better in so many ways.

Walter Donway
October 9, 2016 8:10 am

As far as I can judge with limited knowledge, this is a superb article. I dream that the editors of the “Economist” might see it. I feel the same as the author about the “Economist,” I always enjoyed its seriousness, its level of writing, and its global view. Some years ago, it was still claiming its viewpoint was “classical liberal.” I have seen the magazine move really far away from that, which is said after carrying the banner for a century.

October 9, 2016 8:32 am

Since the Munich 2015 conference, the Economist has shown what kind of publication it is…

October 9, 2016 8:40 am

The Economist stopped being about economics a generation ago.
They now push left wing causes, using phony economic arguments as justification.

October 9, 2016 10:49 am

Media Myth 1: “the words “climate” and “change” have seldom been uttered together on the campaign trail.”
The refutation does not refer to this myth at all.

Prescott Walker
October 9, 2016 12:45 pm

I have been a subscriber to the Economist since the late 1970’s and I have noticed, especially since the change about two years ago in their managing editor, a distinct leftward tilt which is particularly noticeable in their increasingly uncritical position on CAGW…you will never see any reference to uncertainties in the science, and despite several recent articles about shoddy scientific research which cannot be duplicated or which uses questionable statistics, they never include climate science as a field where questionable work is being done.

October 9, 2016 1:15 pm

Great article Andy. Looking forward to reading more of your work.

October 9, 2016 2:16 pm

The Economist used to be a sensible free trade mag. Now it’s just a leftish leftover. Very sad.

October 9, 2016 2:29 pm

“Fossil fuel companies are benefitting from global subsidies of $5.3tn (£3.4tn) a year, equivalent to $10m a minute every day, according to a startling new estimate by the International Monetary Fund.
The IMF calls the revelation “shocking” and says the figure is an “extremely robust” estimate of the true cost of fossil fuels. The $5.3tn subsidy estimated for 2015 is greater than the total health spending of all the world’s governments.
The vast sum is largely due to polluters not paying the costs imposed on governments by the burning of coal, oil and gas. These include the harm caused to local populations by air pollution as well as to people across the globe affected by the floods, droughts and storms being driven by climate change.”
It’s this stuff that annoys me.

October 9, 2016 3:41 pm

I occasionally pick up the Economist if I need a nap .
Something has happened to many of these publications . They used to at least try and appear to be neutral
but I can only conclude they take on the personal beliefs of the Editors and those are clearly big government
hard left . The Economist bias to the green wash of the Earth Has A Fever promoters brings the whole publication down .
The difference now is there are a lot of informed people on the Net and publications like the Economist have lost their franchise . Instead of matching that reality and upping their game they went the other way too afraid to take a risk . Journalistic integrity trumped by green wash political correctness .
It is what it is . Most of the main street media are in a death spiral and are increasingly less shy about
wanting a “conversation ” about government subsidies . It’s a bit hard to push that agenda if they are peeing in the government climate change corn flakes . Who knows maybe they can get a piece of the carbon tax cheese if they pump selling it enough .
The Economist has a chance to save it’s brand but playing safe politically correct is not going to work .

October 10, 2016 2:43 am

It is not unusual to be exposed the allegation that fossil fuel energy companies are subsidized by the government, as the mining industry generally, when discussing the ‘virtues’ of renewables with those of the PGL (Progressive Green Left) persuasion.
I think that they view the government’s refusal to tax an industry anything less than 100% of their profits is a ‘subsidy’.
The answer is, as illustrated in the article, to compare the actual tax paid by the fossil fuel companies as compared to other industries.

Shawn Marshall
October 10, 2016 4:27 am

Control the press – check
Control the schools – check
Control the guns – if KHilarity wins check that too

Hocus Locus
October 10, 2016 7:47 am
This tells a BIG story. If everyone who whines about fossil fuel and nuclear subsidies followed that link, they’d have to start whining about something else. They go by the total money, how convenient for them. But energy produced contributes to GDP and so much more energy is actually being produced by those sources. From a US perspective, even failing to consider that the wind and solar manufacturing process occurs mainly overseas, it’s still a tremendous drain on the economy.
The real money column is the last one, Subsidies per actual MWh generated. From it we learn that rate/taxpayers in 2010 contributed $935.64 for each solar MWh produced while coal received only $0.74. Any time you see two things equivalent in any way with a ‘cost’ ratio of 1,264:1, you need to ask, what the hell is going on.

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