We give extra money to companies that use fossil fuels because they help make energy cheaper for everyone else.
Imagine you're playing a game where you have two types of toys: one is heavy and makes noise, but it's also very strong; the other is light and quiet, but not as strong. The heavy toy is like fossil fuels, it helps power cars and houses, but it costs more to use. So we give that toy a special gift every year, like an extra piece of candy, so it can keep helping us without being too expensive.
Why Do We Give Them Candy?
Sometimes, when the heavy toy is used a lot, it makes things like air and water dirty. But even though it's not perfect, it still helps us get from one place to another easily, just like how your favorite car lets you go on adventures with your family!
We give extra money (or "candy") to the companies that use the heavy toy because they help keep our lives going smoothly, and we want to make sure things stay easy and fun for everyone.
Examples
- Fossil fuel subsidies are like giving a gift card to big energy companies every year.
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See also
- How Does 4 Failed Currencies Work?
- George Selgin: Do we really need Central Banks?
- How Does Circular Flow Diagram In Economics | Think Econ Work?
- How Does Econ 101: Trade Offs and Opportunity Costs Explained! Work?
- How Does Countries With Highest Inflation (1981-2019) Work?