Like it or not, the oil and gas industry are pretty dang critical to supplying strategic and economic needs of the US. Punishing them while still depending on them would be incredibly silly.

Addressing climate change is first and foremost a consumption problem. Addressing it in a supply-side, trickle-down method should be self-evidently counter-productive.

Which part specifically seems like "normal bookkeeping" to you?

  This bill:
  - repeals the tax credits for producing oil and gas from marginal wells and for enhanced oil recovery;
  - repeals the tax deduction for the intangible drilling and development costs of oil and gas wells;
  - repeals percentage depletion;
  - repeals the tax deduction for tertiary injectant expenses;
  - repeals the passive loss exception for working interests in oil and gas property;
  - denies the tax deduction for income attributable to domestic production activities for oil and gas activities;
  - prohibits the use of the last-in, first-out (LIFO) accounting method by major integrated oil companies;
  - limits the foreign tax credit for dual capacity taxpayers (i.e., taxpayers who are subject to a levy of a foreign country or U.S. possession and receive specific economic benefits from such country or possession); and
  - expands the definition of crude oil for purposes of the excise tax on petroleum and petroleum products to include any oil derived from a bitumen or bituminous mixture (tar sands), and any oil derived from kerogen-bearing sources (oil shale).

LIFO is illegal in some countries but is acceptable under GAAP. The Oil industry is not special here.

Percentage depletion is the IRS standard for non-renewable resources. Again, oil is given the same percentage as copper: https://www.law.cornell.edu/uscode/text/26/613

Passive loss exception is also standard: https://www.irs.gov/taxtopics/tc425

The IRS maintains a nicely detailed guide on how tax deductions work: https://www.irs.gov/publications/p535 Almost no one would say a business deducting COGS would be a "subsidy".

The US government has a very established tax code to specifically determine what amount of money it should consider taxable and to smooth out expectations. Claiming a deduction is not inherently a subsidy. Especially if you are a business and might lose 3x as much money in a year as you make to invest in long term growth.

If Oil and Gas have unfair tax advantages, that's a problem. These seem boilerplate.

> a sum of money granted by the government or a public body to assist an industry or business so that the price of a commodity or service may remain low or competitive.

Yes, tax deductions (to businesses) are absolutely subsidies. It's the most common form of subsidization!

> Especially if you are a business and might lose 3x as much money in a year as you make to invest in long term growth.

This bill extends the amortization schedule from 24 months to 7 years. It's actually helping ease this burden. The rest of the clauses are removing what are essentially government handouts to oil and gas companies.

In reality the government is simply just punishing all other businesses that can't take the same deductions.

You might as well consider it a subsidy to you if your neighbor gets mugged.

For example reducing capital available to oil/gas companies -> reduces supply -> increases price -> drives reduction in consumption / switches to alternatives.

What am I missing?

I for example, almost never drive but at the same time I will not get EVs unless you force me because they are unreliable for long distance, I hate queues (for charging stations) and living in apartments means either they get dozens of chargers for the complex or I have to drive somewhere and wait like an hour to charge (if I can make it to the station). So you really have to twist my arm to get anything short of a hybrid.

That said, I am only responding to your question I don't support or oppose oil subsidies since I am not informed enough on the subject

I guess I'll look into the estimates and see.

One thing I would say is that reductions in supply in one jurisdiction will compound with restrictions in other jurisdictions.

For example NZ banned new oil and gas exploration a while ago but some parties want to repeal it with the same argument as yours, someone else will sell it. But if it happens in NZ, then the US, then ... I think you reach a point where there is a non-trivial challenge to increasing supply. Then these measures will have stronger effects at increasing prices and hence reducing consumption.

If I can compare it to something it would be trying to get a heroin addict (or even serious alcoholic) to stop using. If you succeed in cutting off all supply right away, they die. If you cut off supply locally, they will get it somewhere else where you can't help them get rehabilitated. Half measures are almost always worse than not doing anything.

Most of farm subsidies that people talk about goes towards food stamp-type programs. Not wanting the poor to starve may be a good reason.

And when people talk about product subsidies (like corn subsidies) they are referring to the insurance system operated by the government. Due to the nature of what is being insured (i.e. something that is likely to affect most policy holders when disaster strikes), it is difficult for private business to provide the necessary insurance.

Traditional insurance products rely on only a few policy holders needing insurance each year. When mass disaster strikes, such as a hurricane destroying homes across a wide area, the government typically does step in to cover the difference. Since this is the norm for agriculture, the government stays at the ready. Farmers still have to maintain a paid policy to be participants in the insurance system.

Perhaps insurance should be abandoned, but it's generally considered a social good.

There are a few other notable sets of subsidies:

- Irrigation water in the US is artificially cheap for farmers

- The US offers several Export Credit Guarantee programs (the WTO has specifically found to be illegal internationally): https://www.fas.usda.gov/programs/export-credit-guarantee-pr...

- There are amply funded Conservation programs - which can often involve payments to do nothing with certain pieces of land: https://www.fsa.usda.gov/programs-and-services/conservation-...

- And bigger than anything, over half of all direct payments to farms are from Commodity programs: https://en.wikipedia.org/wiki/Commodity_programs https://farm.ewg.org/region.php

As you can see in your second link, the direct payments ended under Obama. All of the remaining programs for commodity producers are insurance-based.

Perhaps what you are trying to say is that there are time travellers coming to us from the past to tell us about how things used to be (from our perspective)? But why would anyone listen to them?

And it does seem the government continues to give direct payments to farmers - even though it is under the guise of the insurance program: https://www.fsa.usda.gov/news-room/news-releases/2021/usda-p...

I would also not call the price protection programs an insurance program. Being able to sell at a certain price seems like a pretty strong and direct subsidy.

And the export credit, which is not overseen by the USDA at all, continues.

And when you look the breakdown you'll see when direct payments ended. Insurance is going to pay out, yes. That's what insurance is for...

> I would also not call the price protection programs an insurance program.

I would. It is setup as an insurance system. Price/income insurance isn't uncommon, even outside of agriculture. If you work as an employee, you are afforded access to similar insurance.