how do subsidies work, such as fossil fuel or farm subsidies? What benefits do they provide and/or what harm would result from stopping them?

Question

I just read a post about how the US spends more on fossil fuel subsidies than on Education and I am totally confused as to their purpose and effectiveness.

In: Economics

Answer 1

A government subsidized industry is aided and partially funded by the government. These subsidies come in different forms, such as certain types of bursaries, loans and tax breaks. The US Govt subsidizes the oil and gas industry more than schools. Oil would cost more per gallon if subs were cut. There would better funded schools if their subs were increased