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Correct - good point
Posted by john b (more from john b) on Wed, 27 Apr 2011 19:12:53
In Reply to: Does US military presence count as a "subsidy"?, Bill Homer [Profile/Gallery]
, Wed, 27 Apr 2011 08:17:10
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Great point Bill.
So we spent $687B last year on DOD, and $150B of that was direct costs for Iraq/Afghan conflicts. Doesn't include indirect costs such as VA care for wounded and disabled, etc which may eventually double it.
So if you take the $150B directs costs for the Middle East conflict, plus some percentage of the remaining $500B annual DOD budget that is spent to build, man and operate the carrier fleets that we keep over there to protect the Straits of Hormuz, the Bosporus, etc and the CIA ops, and drones, and so one - let's say conservatively 20%, or another $100B.
Add $150B direct war costs, $100B general costs = $250B/yr to police the region and fight to protect the reserves over there. We use roughly 7B barrels of oil per year in the US. Divide it out and you have a military cost of $35/BBL or $1.00/GAL that is currently not included in our direct energy costs because IT IS SUBSIDIZED BY THE US GOVERNMENT.
If we add that cost directly to the cost of oil (which it should be) which is currently around $110/BBL on WTI (Brent spot price is much higher), we would have oil at $145/BBL which would bring gas costs up to $5/gal. That's where it was when we tipped into recession in 2008.
But yes, we don't see it directly because it is an indirect cost. In other words we are missing some transparency on this whole oil cost thing.
In any case, you are correct.
Posts in this Thread:
- Oil company subsidies?, No Snaab, Tue, 26 Apr 2011 07:25:34
- Are political comments permitted on the General Board?, dudethe9-5isfast, Wed, 27 Apr 2011 19:10:30
- Does US military presence count as a "subsidy"?, Bill Homer , Wed, 27 Apr 2011 08:17:10
- Re: Oil company subsidies?, john b, Tue, 26 Apr 2011 22:47:29
- Re: Oil company subsidies?, EGD , Tue, 26 Apr 2011 15:21:05
- Gee...uh.... I'mm have ot make this short., nwas, Tue, 26 Apr 2011 13:17:48
- Re: Oil company subsidies?, AeroEd, Tue, 26 Apr 2011 09:38:03
- Re: Oil company subsidies?, kkelley, Tue, 26 Apr 2011 09:02:28
- subsidies vs. ?, AeroEd, Tue, 26 Apr 2011 09:44:51
- Re: subsidies vs. ?, kkelley, Tue, 26 Apr 2011 11:13:02
- Balance, nwas, Tue, 26 Apr 2011 13:19:55
- Re: Balance, kkelley, Tue, 26 Apr 2011 13:27:02
- Re: Balance, James, Wed, 27 Apr 2011 03:28:29
- Yes, nwas, Tue, 26 Apr 2011 18:21:16
- Re: Oil company subsidies?..Ethical Capitalism! n/m, Joeychess, Tue, 26 Apr 2011 08:28:55
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