Oil companies get a manufacturing tax credit that probably shouldn’t exist for any companies — so let’s abolish it for everyone rather than just the oil companies. They also enjoy, some of them, accelerated depreciation on investments, which probably should be extended to all companies. There just aren’t that many targeted subsidies that benefit the oil companies. And getting rid of them won’t bring the price of gas down.
The big energy subsidies, on a per-unit-of-energy basis, are for ethanol, solar, and wind power. Get rid of the oil subsidies — and the “oil subsidies” — and nothing much changes. Get rid of the subsidies for those other energy sources, and those industries disappear. Just ask their lobbyists.
My thanks to Jerry Taylor (Cato) and Steve Hayward (AEI) for walking me through these issues.