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To: BO Stinkss
Let’s declare war on our energy supplies!

Ending subsidies is now declaring war?

7 posted on 08/24/2011 11:35:49 AM PDT by Prokopton
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To: Prokopton
Ending subsidies is now declaring war?

Most "subsidies" to the energy industry aren't subsidies at all. Instead, they are accounting rules that reflect the actual exigencies of the business.

For example, an independent driller drills an exploration well on a "wildcat" basis.

Upon completion, dry hole or a strike, normal accounting rules would treat the cost of drilling the well as a capital asset (like building an office building), rather than as an expense. Consequently, its cost would have to be amortized over a seven- or ten-year schedule.

The "subsidy" to independent drillers is to allow them to write off the well in one year -- i.e., treat it as the expense it really is. Whereupon, the independent driller then has the financial statement to do what they're in usiness to do -- drill another well.

In other words, the subsidy doesn't qualify as a "loophole". Instead, it's an adjustment of the tax code to reflect the realities of a given industry.

9 posted on 08/24/2011 11:51:43 AM PDT by okie01 (THE MAINSTREAM MEDIA: Ignorance On Parade)
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To: Prokopton
Ending subsidies is now declaring war?

They aren't subsides. Allowing them to keep more of their own money is not a "subsidies" as these Leftist groups claim. What ARE subsides, is the hundreds of billions in Government dollars handed out to fund these groups favorite "green jobs" boondoggles. They aren't advocating "cutting spending" they are advocating tax hikes. Just another Progressive Fascist political machine lie.

10 posted on 08/24/2011 12:31:01 PM PDT by MNJohnnie (Giving more money to DC to fix the Debt is like giving free drugs to addicts think it will cure them)
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