Here’s the latest reader question, along with my reply!
Susan writes: Hi Eric, I just listened to you on the Energy Week podcast. I agree on most of your assessment of EVs. However, you addressed the subsidization of EVs but did not mention the subsidization of fossil fuels. Was that a deliberate omission or do you think that doesn’t equate?
My reply: It’s a red herring that oil is subsidized. If anything, money is spent – on “defense” to keep prices high by limiting supply.
If the proverbial spigots were opened up, the price of oil would plummet. It is kept artificially high by throttling back on production, by restricting what is brought to the world market – to maintain petro dollar control over oil.
The price of oil is also made artificially higher by confiscatory taxes which amount to more than 20 percent of the cost of each gallon of gas made from the oil. Meanwhile, EV owners pay no motor fuels taxes whatsoever – another subsidy designed to make the EV seem less costly than it is – and it still costs far too much to be cost-competitive with IC.
Oil does not need to be subsidized.
There is ample supply – and natural demand. The “peak oil” shibboleth has been exposed for the shibboleth it always was. America is now the world’s leading producer of oil – and may soon become its largest exporter. Twenty years ago, there were hysterical ululations about the wells running dry and imminent scarcity. Now that we know scarcity isn’t a threat, a new threat had to be created – carbon dioxide “emissions” and “climate change” – to justify the force-feeding of electric cars and their necessary subsidization.
EVs cannot survive – as other than toys for the very affluent – without massive subsidies. IC cars do not need subsidies of any kind to be functionally or economically viable.
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