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Bloomberg View: Learning from Iran (Yep, Iran); the Fed's Plan to Jump-Start Housing

Learning from Iran (Yep, Iran) ● The Fed’s Plan to Jump-Start Housing

In 2010 the value of all fossil-fuel subsidies, for both production and consumption, was roughly $500 billion. On the consumption side, 37 countries spent $409 billion underwriting their citizens’ fuel purchases, according to the International Energy Agency. You can fill up a 32-gallon Hummer for about $3 in Venezuela.

The IEA, an independent body formed after the oil shocks of the 1970s, estimates that only 8 percent of that $409 billion went to the bottom-income quintile. Moreover, such government funding sucks up money that could be used to help the poor in other ways: Venezuela devotes at least 6 percent of its gross domestic product to fuel subsidies, about double its education budget; in Indonesia that amount is around 4 percent; the $6 billion that Nigeria has been spending to keep fuel prices low is three times its health budget.