The gloomy light called subsidy.

[Spaceman1000$]

There are lots of things as citizens that we've enjoyed especially when it comes to essential things that government of our various countries have subsidize.
For some countries, government has helped in subsidizing food production, electricity, education,  transportation, health care services etc.
This subsidy goes ahead in reducing financial burden on the citizens.

 for some it is one way the government has helped them directly, because government gives them grants to support their businesses.
So I ask, what will happen if the government remove subsidy from some of the essential things that they helped citizens to subsidize, for example, fuel, electricity, food production, health care services etc.

Because I leave in a country, where the subsidy for PMS(petrol) has been removed, and almost immediately, the citizens are feeling the effect of the petrol subsidy removal.
The shocker this singler act has sent to the  spine of the economy of my country is second to none.
At this point, I've realised that, subsidy is one gloomy light that shouldn't be dimmed further  by any government.
Cause what other better ways can the citizens benefit from her government if subsidy is taken off from those essentials that directly touch the standard of living of the citizens.

What do you think? Is government removal of subsidy from essentials products, services at this period of economic hardship people are facing the best policy a  government can embark on in the process of building her dwindling economy?

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[EarnOnVictor]

The subsidy is good, but only with a progressive government and economy, it's a way the government gives back to the people which I believe is also the right of the people when they have a responsible government. However, the subsidy built on corruption, and also by the regressive government will certainly backfire. That is the case in Nigeria right now.

Also, the government's approach to subsidy should be dynamic depending on how progressive or regressive the economy and government finances are. If static and delayed for too long before acting, it would cause damage more than what they were intending to solve initially by it.

[stompix]

Because I leave in a country, where the subsidy for PMS(petrol) has been removed, and almost immediately, the citizens are feeling the effect of the petrol subsidy removal.

Imagine how this sounds for a European who pays double the petrol and diesel cost since half of the price is just taxes!

It's pretty simple your country can't afford to pay the subsidies anymore, I can guess it's Nigeria??
Same thing anyhow, you can't offer subsidies if the returns are not worth it just to keep your people happy, In Venezuela, and Iran, at one point you run out of money, and then you have to face the reality that you were just wasting taxes to keep the population under control.

At this point, I've realised that, subsidy is one gloomy light that shouldn't be dimmed further  by any government.

Subsidies can be also toxic leading to a country paying more to produce something than it would have had paid by importing something and simply paying a normal wage to the workers employed even if they won't be doing a thing
Sometimes agriculture subsidies go so high that with all the insurance and damage relief included they are over the actual price of the product.

[Die_empty]

The subsidy is good, but only with a progressive government and economy, it's a way the government gives back to the people which I believe is also the right of the people when they have a responsible government. However, the subsidy built on corruption, and also by the regressive government will certainly backfire. That is the case in Nigeria right now.

Corruption is not a genuine reason to stop subsidies. It is the government thet is corrupt and not the process of subsidizing these essential products. Removing subsidies is causing so much hardship and some businesses have closed down. While many people have been pushed down to abject poverty. What the government would have done was to identify these avenues of corruption and deal with them. Loopholes and financial leakages should be identified and standard financial and accountability strategies should be put in place. The painful part of it is that the funds saved from the removal of subsidies will still be looted by these corrupt government officials.

What do you think? Is government removal of subsidy from essentials products, services at this period of economic hardship people are facing the best policy a  government can embark on in the process of building her dwindling economy?

This will be a good policy if the government will sincerely use the money that will be saved from subsidy removal to invest in the country. If the saved funds will be used to build basic infrastructure that will lead to development, then it is good. But if the money will be misappropriated and stolen by corrupt government officials, subsidies should continue. In some countries, subsidized goods or services are the only benefits they get from their government.

[CODE200]

You know, instead of removing the subsidies, most government should stop favoring the rich people and let them get away not paying their due diligence to the country. Also, a corrupt government will not be able to revive or heal a downed economy no matter how because they're lining their pockets with the money that was supposed to be used to fix the problems in the economy.

[EarnOnVictor]

The subsidy is good, but only with a progressive government and economy, it's a way the government gives back to the people which I believe is also the right of the people when they have a responsible government. However, the subsidy built on corruption, and also by the regressive government will certainly backfire. That is the case in Nigeria right now.

Corruption is not a genuine reason to stop subsidies. It is the government thet is corrupt and not the process of subsidizing these essential products.

Can you hear yourself, still contradicting what you wrote by yourself? Apart from the fact that you brought it out of a bundle of meanings before detaching that for the purpose of finding your contradictory meaning to it, the word "Subsidy" is meant for a purpose, and when the purpose is defeated by corruption that can't be solved or affecting the nation's purse, then it's useless. Subsidy-mixed with corruption is a burden to any country and its economy, especially when there is no progress or hope for it, it makes no sense to continue it with such an equation.

You don't subside when you don't have the muscle for it and when it is lined with corruption, subsidy is never by force, it's a privilege. Particularly when politicians are pocketing much of it and are not accountable for any reason, for whose gain is now the subsidy? To what end?

Therefore, I repeat in more simplified words in case you don't understand, a subsidy built on corruption in a bad economy is highly irresponsible and will always backfire.

[Yamane_Keto]

The problem of direct support for commodities such as fuel leads to smuggling, as someone can buy fuel at a price and try to sell it at the border at twice the price, and here it will lead to the state importing more fuel and thus more unnecessary expenses.
Direct support for individuals is much easier because you will spend a lot of money to ensure that the goods subsidy goes to the needy, while direct support you can transfer money directly to the bank accounts of individuals and through it make sure that they are in need or not, while direct support means supporting all classes, rich and poor.

[Die_empty]

The subsidy is good, but only with a progressive government and economy, it's a way the government gives back to the people which I believe is also the right of the people when they have a responsible government. However, the subsidy built on corruption, and also by the regressive government will certainly backfire. That is the case in Nigeria right now.

Corruption is not a genuine reason to stop subsidies. It is the government thet is corrupt and not the process of subsidizing these essential products.

Can you hear yourself, still contradicting what you wrote by yourself? Apart from the fact that you brought it out of a bundle of meanings before detaching that for the purpose of finding your contradictory meaning to it, the word "Subsidy" is meant for a purpose, and when the purpose is defeated by corruption that can't be solved or affecting the nation's purse, then it's useless. Subsidy-mixed with corruption is a burden to any country and its economy, especially when there is no progress or hope for it, it makes no sense to continue it with such an equation.

You don't subside when you don't have the muscle for it and when it is lined with corruption, subsidy is never by force, it's a privilege. Particularly when politicians are pocketing much of it and are not accountable for any reason, for whose gain is now the subsidy? To what end?

Therefore, I repeat in more simplified words in case you don't understand, a subsidy built on corruption in a bad economy is highly irresponsible and will always backfire.

Is the problem subsidy or corruption? In case you don't know many developed nations subsidy many products to help people live a good life. And these nations make the process transparent and void of corruption. You don't need to "throw away the baby with the water, you keep the baby and throw away the bathing water". My point is clear @EarnOnVictor tackle corruption and leave subsidy. If your sole reason for removing subsidy is because of corruption, then it's not good. What happens to the people that benefit from it?

If the government wants to stop subsidy because it cannot be sustained due to a fall in revenue or economic challenge, it's a better reason. Now the question you will ask yourself is that who is making the subsidy process corrupt? It is still the government. The money saved from subsidy will be shared among state governors through the Revenue Mobilisation Allocation and Fiscal Commission and most of these funds will go to private pockets. If the government makes the fuel subsidy process transparent, it will alleviate the suffering of the masses.

[Spaceman1000$]

The problem of direct support for commodities such as fuel leads to smuggling, as someone can buy fuel at a price and try to sell it at the border at twice the price, and here it will lead to the state importing more fuel and thus more unnecessary expenses.
Direct support for individuals is much easier because you will spend a lot of money to ensure that the goods subsidy goes to the needy, while direct support you can transfer money directly to the bank accounts of individuals and through it make sure that they are in need or not, while direct support means supporting all classes, rich and poor.

If the issue is bothered on smuggling, then the government should be proactive enough to stop such illicit activities as such, the entire economy shouldn't be brought to her kneels because of that.
There is no amount of direct support system that can be too effective as to reducing the effect of the subsidy removal, because prices of goods and services will automatically raise and I think the government cannot give support to every household.

[Plaguedeath]

If your government remove the subsidy, it's mean they're currently not in a good financial, so they can't just cover up the primary needs to make the poor afford to buy it. However is your country charge a high tax? the government earn a lot money from tax, so it must be the rich not paying tax.

If the rich keep evading tax and the financial problem in your country is still not recovered, I would say beware of inflation and the possible banks going to bankrupt.

[icalical]

I think removing the subsidy completely on essential goods like petrol is removed completely. However in my opinion government shouldn't spent the more money on subsidy than on more long term thing like education and health. The more possible way may limit the subsidy, so the government could only subsidize petrol for commercial truck that are used for distribution, and public transportation so the price of other product wouldn't be affected.

[dothebeats]

Of course subsidy is good as it helps a lot of people in need, specially with the state of the market these days. However, governments should know when to cut off and just how much budget they should assign towards it. It is understandable that a lot of people are dependent on such subsidy, but it should be noted that other areas needs more attention and budget much like education and health.

[Lorence.xD]

Because I leave in a country, where the subsidy for PMS(petrol) has been removed, and almost immediately, the citizens are feeling the effect of the petrol subsidy removal.

That's sad to hear, but my situation in my country is more worse about this kind of issue about the Petrol. Because in your country they have subsidy to give from the Petrol to give to it's citizens, but in my country there's none plus the cost of the petrol is increasing fast due to inflation rate that affected the Petrol. Of course it gives a negative impact to the people especially to the people who needs petrol for their motor vehicle for their work. Imagine you working to provide for your needs and the little help the government could give were taken away? Nah one thing that first come to my mind in this kind of situations are corruption.

What do you think? Is government removal of subsidy from essentials products, services at this period of economic hardship people are facing the best policy a  government can embark on in the process of building her dwindling economy?

I think if they implement this kind of policy in the country of course there would be a substitute like giving them a job, shelter or even education. As long as those money that were taken away from the subsidy would be use wisely to improve the country. I know that they are having a hard time to determine where to focus investing their money in any country. For example in my country which is PH, they invested at skyway and new railroads since one of the major problems here is traffic. Of course due to those investment there would be a hard time to provide the subsidy for the people. Maybe if there's no corrupt officials maybe losing subsidy despite of investing to any other projects, subsidy would still exist.

[The Hidebehinder]

Subsidies are just theft!
The government is stealing you money though taxes and then they are buying your votes with subsidies.
How would a subsidy on petrol help the poor, only 6% of the population owns a car, if you want to help subsidize transportation not fuel that would end up smuggled.

The romans had a great saying, "panem et circenses" bread and circus, feed your population with cheap bread and give distractions and you will have a submissive population, same here, tax the fuck out of them in all means, do nothing for healthcare for education for your industry but give them cheap fuel and build a few stadiums for football matches and you're set.

[Gyfts]

Subsidies aren't capitalistic in nature and they become a problem when the government starts subsidizes entities with a negative ROI or things that don't actually have a net benefit to the citizens. I'm generally against the government picking industries to subsidize with tax payer money unless there's a benefit to every single citizen (and of course, there's no way to determine the "winners".)

The energy sector and agriculture sector provide a net benefit to every citizen, those are acceptable. But the types of subsidies matter as I've seen government provide subsidies to green energy companies, to the tune of billions, only for those companies to go bankrupt a short few years later. And the companies that get these subsidies are often political donors. It's not necessarily corruption, but it isn't fair for the citizens to have to bear the cost of a politicians political favors either.

[panganib999]

Subsidies have no downsides, so I don't think their absence will produce any form of positive effect on anyone cause yet again, at the end of the day no matter how we thank the government for giving us these things, they take the funds and the capacities from our own pockets in the form of tax. So if the government were to remove subsidy programs, what would they do with the money that's dedicated to subsidy? What would they do to replace this effortless program that provides lots of benefits with no downsides?

Subsidies only become a problem when they are used on stupid things, so perhaps it's not subsidy that should be abolished or what even in this theoretical analogy you made OP, perhaps the one's to be abolished should be those that make stupid legislations and decisions in the government!

[Adbitco]

Well from my view spaceman1000$ don't you think this is a master minded game played by the new government and how are we sure if there where fuel subsidy in the country?
Same products our government keeps importing since they weren't able to our fixed refineries, we had Portharcourt Refinery at Eleme and I think there is other at Lagos and other places why can't they fixed them and stops wasting money to import a buy products from other neighboring country.

We had the capacity and resources to fixed our refineries but it is being politicize which since they had a serious allocation for it and is going to their personal account they wouldn't want to fixed up those refineries across the country and yet there are lot petrolatum engineers graduating from our universities, how come they studied those courses without us having a functional refineries to properly equipped them on their field of study. Well I don't want to delve into details of our there nation as it has been taken over by greedy leaders who doesn't have love for her citizens.

[hatshepsut93]

What do you think? Is government removal of subsidy from essentials products, services at this period of economic hardship people are facing the best policy a  government can embark on in the process of building her dwindling economy?

If that would happen, people will be driven to criminal activities, and there will be a lot of social unrest, which might even eventually result in revolution. But even without revolution this unrest could cause so much damage that it would surpass the spendings on subsidy.

Some people might believe that any redistribution of wealth is unfair and is equal to robbery, but for society as a whole it's a net positive if done right. Too much redistribution will definitely hurt the economy, but too little redistribution is quite dangerous.

[Darker45]

In general, I'm not a huge fan of subsidies. Subsidies might be necessary in some instances, but I think it should be considered as the last resort. To a certain extent, a government that has limited resources but is all too willing to provide subsidies left and right is an incompetent and lazy government. It's a government that's not creative or innovative enough, a government that doesn't study, analyze, and look for other ways and means to improve certain conditions. Subsidies are dole-outs. They're a band-aid solution. They're not sustainable. Money put into subsidy is most often money that is wasted.

In my country, subsidy is quickly considered as a response more often than it should be. A rising price of rice, subsidy. A rising fuel price, subsidy. A rising transportation cost, subsidy. Onion price rising, subsidy. Poor families, subsidy. Retirement benefits and pension, subsidy. It's subsidy everywhere. It's not even counting the huge tax subsidies that it also provides to companies and businesses. Almost all departments in the governments are now providing subsidies. For goodness' sake, can we not explore other options?

[Dave1]

You are lucky that you have a government that subsides your petrol. But then again it's a privilege that can be taken anytime and so that's what they do? For me? I will strive hard as I know I don't have the petrol subsidy already.

Or maybe you can tighten your belt, save money or get other means of transportation so that you won't used your car like everyday. It's could have a pros/cons of the removal, but I guess your government is trying to save money as well and uses to other projects or top up other subsidies that is very important to the population.