Fuel Subsidies Literature Review

According to VisionLaunch, people are worried about their papers full of responsibility: money. This corn fuel drives up the price of food products. This means that corn is more expensive since it is being used for fuel. It is a fact that corn is being used more for fuel than food, which is why it is more expensive. Subsidies are to help take care of that problem and reduce the amount of money corn is worth. However, there is a problem because the subsidies are funded by taxpayers which is not affecting us or

There has been some talk about an “oil-extraction tax.” With this tax in place, it would force companies to fork out more of the tax instead of the consumer. If higher taxes are put in place for the producer ultimately they are not the ones paying the higher price the consumer is. Either way producers will receive revenue and in order to do that they will just raise their prices. The demand for fuel is based on necessity forcing consumers to pay outrageous prices because they need it. In addition to the tax, oil companies would have to disclose more information about their supplies and prices. Since the companies have market power, some believe with the tax in place it would reduce the price of the good.

Without access to fuel, industry is hindered. The time it takes to travel from point a to point b increases tremendously if there is a limit to the amount of fuel that one has access to. In the 1970’s during an “oil crisis”, gas stations limited customers to 10 gallons each. The need to stop at more gas stations more often will increase shipping time, decrease productivity, and hinder new nations in their development and entrance into the postmodern marketplace.

The “U.S. became the world’s top producer of petroleum and natural gas” in 2013 (Energy Infrastructure). “Capital spending in the infrastructure that moves and transforms oil and gas into everyday products … has increased by 60 percent between 2010 and 2013” (Energy Infrastructure). The rise to become the top producer has led to the decrease in “U.S. oil import dependence” and the “rise of U.S. product exports” (U.S. Oil Import Dependence). The increased exportation of oil and gas by the U.S. has allowed both of these products to become large moneymakers for the United States. Although we will probably never “completely eliminate our need” for oil, we can reduce our petroleum consumption and the damage we inflict on the environment (Reduce Oil Dependence Costs). By decreasing the “dependence on oil” in new vehicles, there has been a

First, the foremost issues at hand are currency and opportunity. Currency and the overwhelming desire for more are the pivotal driving factors in a gasoline and diesel industry. The government receives too much money from these industries to make the adjustments that are necessary. Unfortunately, the government does merely enough to get by. However, Americans need to analyze the opportunities at hand. In the text "Brief Principles of Macroeconomics," author Gregory Mankiw tells us that, " the opportunity cost of an item is what you give up to get that

In 2012, gas reached more than $3.50 per gallon. Today, gas averages have remained around $2.50. What I found most compelling about the pros is with every penny decline, a billion dollars is returned to customers. It is completely astonishing that one cent can have such an enormous impact. Because of the production of oil in America, low fuel cost have allowed Americans to save money and take much-needed vacations. Whether traveling by vehicle or plane, we are all much happier when we get behind the wheels of our vehicles or on a plan due to low fuel costs. On average, households are saving over $700 per year and even more if there are multiple vehicles. Americans were long overdue

Between 1990-91 and 1995-96, total fossil fuel subsidies in 14 developing countries that account for 25 percent of global carbon emissions from industrial sources declined 45 percent, from $60 billion to about $33 billion)…Within the past six years, India, Mexico, South Africa, Saudi Arabia, and Brazil also cut fossil fuel subsidies significantly…Many developing countries are also actively promoting energy efficiency and renewable energy.

Cars, just about every household in America has probably at least two parked in their driveway at any given time. The dependency on the gas powered car has substantially increased since it’s invention and production back in 1908 by the Ford Motor Company. As of 2014, it was estimated that there were over 88 million cars produced world-wide and growing every day. (Fig. 1) Even though a lot of these vehicles might be the new Hybrid edition, the majority of them have a dependency on oil and gasoline products for their survival and existence. Petroleum products, such as oil and gasoline do not come cheap or even free to the consumer, even the

As western society has been aggressively expanding, the consumption of materials has followed suit. This leads to a negative effect on the environment. To curb the decay of the planet, it is important for humans to have a handle on how much we consume. One consequence of consumption is the emissions produced by our vehicles. It is crucial to develop a government policy that most effectively controls and reduces the amount of these emissions we give off. While the government has introduced many subsidization policies, the most efficient policy the government could enact is to raise the taxes on gas.

4). When ethanol was first being produced, it could not survive on its own, so ethanol producers lobbied the government to pass the Energy Tax Act of 1978, which gave fuel blenders forty cents for each gallon of ethanol blended with gasoline (Corn Ethanol Subsidies par. 3). This bill was in effect until 2004, when the Volumetric Ethanol Excise Tax Credit (VEETC), which gave gasoline blenders fifty-one cents per gallon of ethanol blended, was enacted (Corn Ethanol Subsidies par. 3). In 2008, the Farm Bill reduced the subsidy to 45 cents per gallon of ethanol blended with gasoline (Corn Ethanol Subsidies par. 3). The ethanol industry also receives tax breaks such as The Alternative Fuel Vehicle Refueling Property Credit, which provides a thirty percent tax break for gas stations that use biodiesel or 85 percent ethanol (E85) blender pumps (Federal Subsidies for Corn par. 3). These subsidies and tax breaks create artificial incentives for gasoline blenders and gas stations to use ethanol in their gas, all while rewarding ethanol producers and corn farmers with more money. These subsidies are harmful to taxpayers because these industries are fully matured and extremely prosperous, they do not need handouts that the consumers have to pay for. The ethanol industry also receives aid from the

Citizens in a traditional economy are already accustomed to the long walks in heat or cold in order to get to their destination, so they do not need gasoline to power their motor vehicles. Economist John Maynard Keynes would argue that the government should be spending money on reasonably priced gasoline for the nation and that by buying expensive fuel products not only is it polluting the environment but it is running many citizens into bankruptcy. Several cars are put up for sale every year because individuals across the nation cannot afford to keep the bills, between insurance, maintenance and gasoline a cars expense in a month ranges from one to three grand. The government needs to set a new price standard for gasoline, by having it set to a lower rate, it would save the stress of many

Renewable energy has currently become a significant aspect in the countries generation, combination, and a constitution focus of government policy for energy, and environmental protection. As a result of public’s growing responsibility for the environment and constantly binding rules, and regulations of emission in the electric power industry, government has facilitated policies to boost the amount of renewable energy in the electricity generation portfolio. Additionally, the generation of electricity from renewable resources creates insufficient, and frequently, zero emissions of pollutants that comes from traditional fossil fuel production technologies. The additional use of renewable energy aids utilities in their emission agreement obligations. Furthermore, the anticipation of agreement with any future carbon emissions management would further toughen the incentive to move towards cleaner electricity creating technologies (Langwith, 2009).

Drivers realize that the price of gas is tied to the market value of crude oil, and has a direct impact to their daily commutes, errands, and vacations. However the reality is that the price of fuel has implications much grater than most consumers realize. Fuel prices affect nearly everything we purchase. For example, the price of farm commodities and food increase because farmers pay more for the fuel for their farm equipment and trucking firms pay more for fuel to get the commodities to market. These shipping “fuel surcharges” impact all goods

In the article “The Poor Need Cheap Fossil Fuels”(2013), Lomborg’s main claim is that although it is important to deal with global warming caused by the burning of fossil fuels, the current priority should be providing cheap fossil fuels to the poor who indeed need them. To support his claim, Lomborg first states that fossil fuels are essential, especially to the poor, and will still be for decades. He emphasizes that only reliable, cheap fossil fuels can improve lives of those living in energy poverty by making electricity accessible and reducing indoor air pollution caused by the burning of dirtier fuels, which is more detrimental than outdoor air pollution. By further suggesting that greener energy may not be globally distributed very soon,

The US consumed 142 billion gallons of gasoline in 2007 and the tax applied on it is 18. 4 cents on one gallon. All around the US, there are around 162,000 retail gasoline outlets. With the price of crude oil hovering around $100 a barrel, it is no wonder that concern is growing about the gas prices being so high. After all, modern economies are kept moving by this lifeblood. For instance, in the United States alone personal vehicles consume more than 140 billion gallons of diesel fuel and gasoline per year.However, there are several factors that contribute to the gas prices being so high. Given below are a few of them. Increasing Demand for Oil One of the main catalysts for the incessant rise in gas prices has been one of the most