[AnthonyMouse]

If something actually saves money then it doesn't require a subsidy because people would be doing it regardless.

Meanwhile the government doesn't have any of its own money, so it can't really give you something that was yours to begin with, all it can do is take it from you and then give it back with strings attached. How is that helping you? Instead of subsidizing something you can make up your own mind about whether you want, they should just lower your taxes by the amount of the subsidy and let you use your money for that or something else at your choice.

[embedding-shape]

> If something actually saves money then it doesn't require a subsidy because people would be doing it regardless.

Spoken as someone who never been poor. There is definitely a ton of stuff people with money can do to save more money, that is completely out of reach for the people who would actually benefit from those savings the most. Subsidies is quite literally about reaching these folks that others tend to forget about.

> all it can do is take it from you and then give it back with strings attached. How is that helping you?

Compared to "take it from you and not give it back to you", it's definitely helping people who have less money. Not sure how this needs explaining.

[AnthonyMouse]

> Spoken as someone who never been poor. There is definitely a ton of stuff people with money can do to save more money, that is completely out of reach for the people who would actually benefit from those savings the most. Subsidies is quite literally about reaching these folks that others tend to forget about.

Except that there is no additional money, its just your own money but now there are strings.

On top of that, that still isn't necessary for things that save a non-trivial amount of money, because that's what loans are for. If it has a $100/mo loan payment and saves $150/mo on the electric bill then you take out a loan or buy it on an installment plan and don't need to have any accumulated capital in order to do it.

> Compared to "take it from you and not give it back to you", it's definitely helping people who have less money. Not sure how this needs explaining.

Why would anybody want that either, instead of just not taking it from you to begin with?

[yorwba]

> that's what loans are for

Upthread: "interest free loan of 15k" https://news.ycombinator.com/item?id=48904009

[AnthonyMouse]

Loans for non-trivially profitable investments don't require government interest subsidies.

[thaumasiotes]

Well...

>>> If it has a $100/mo loan payment and saves $150/mo on the electric bill then you take out a loan or buy it on an installment plan and don't need to have any accumulated capital in order to do it.

This depends on whether you'll pay back the loan. Just because paying the loan back saves you $50 / month forever starting immediately doesn't mean you'll do it. You might be the kind of person who takes out a loan, spends all your money on something else, and lets the bills go unpaid.

If you aren't that kind of person, you probably do have some accumulated capital.

But if you are, just the fact that the loan is hugely profitable and you should be able to pay it back - if you were a completely different person - doesn't mean you'll be able to get the loan. You shouldn't be able to get the loan, because you won't pay it back.

[AnthonyMouse]

> You shouldn't be able to get the loan, because you won't pay it back.

In which case you shouldn't be able to get the loan regardless of an interest subsidy, because you won't pay it back.

[yorwba]

The recipient doesn't necessarily know ahead of time how profitable the investment will be. Risk aversion will cause them to avoid investments that are profitable in expectation if they believe the chance of ending up worse off is too high. By offering interest-free loans, the government can pool that risk so that individual loan recipients hesitate less to make the positive-expectation investment.

[AnthonyMouse]

> The recipient doesn't necessarily know ahead of time how profitable the investment will be.

Neither does the government.

> Risk aversion will cause them to avoid investments that are profitable in expectation if they believe the chance of ending up worse off is too high.

Risk aversion works both ways. The risk of not making the investment is that electricity prices in the evening get too high and then you have to pay them. If you install the batteries then you have a known fixed loan payment. If you don't you have an unpredictable variable electric bill. Which one triggers more risk aversion?

> By offering interest-free loans, the government can pool that risk

Risk pools don't work for correlated risk. The primary financial risk is that too many people install batteries -- which subsidies make more likely -- causing the price differential between various times of day to become too small to justify the investment. And that can happen even with interest subsidies. So then you have the government expending tax money to not just cause the people who would have installed them anyway to end up underwater, but to increase the number of such people.

[mothballed]

... for purchases from "approved" "accredited" suppliers[]. AKA the interest differential is regressive tax to funnel money to favored suppliers. Notice there's no option for the poor to simply install it themselves, which would save them more money than an interest free loan, but wouldn't funnel money to rich government approved install contractors.

And there's your grift. As soon as the home owner wants to allocate the "profit" of install to themselves, it is a swift kick in the ass but that will go to our buddies, and thank you very much for your taxes.

[] https://www.energy.nsw.gov.au/households/grants-rebates/home...

[embedding-shape]

> Except that there is no additional money, its just your own money but now there are strings.

I understand what you mean, and yeah, "it's just your money", but also, it really isn't. Poor people have to pay taxes, no way around it, getting them back as subsidies is still better for them than not getting it back at all. The choice isn't "Keep the money or have subsidies", the choice is "The money goes to other stuff or get subsidies".

> On top of that, that still isn't necessary for things that save a non-trivial amount of money, because that's what loans are for. If it has a $100/mo loan payment and saves $150/mo on the electric bill then you take out a loan or buy it on an installment plan and don't need to have any accumulated capital in order to do it.

Are those interest-free or managed by for-profit entities? Because "loans" are vastly different things compared to subsidies, but I'm guessing you already knew this.

> Why would anybody want that either, instead of just not taking it from you to begin with?

Because "not taking it from you to begin with" isn't a practical and realistic alternative, that's not how the world, and especially taxes and government works...

[AnthonyMouse]

> The choice isn't "Keep the money or have subsidies", the choice is "The money goes to other stuff or get subsidies".

That's the false dichotomy that happens in a broken government, but then why hold that out as something desirable?

> Are those interest-free or managed by for-profit entities?

Is the larger amount of mortgage or car loan debt they have to carry when they pay the extra money in tax?

> Because "not taking it from you to begin with" isn't a practical and realistic alternative, that's not how the world, and especially taxes and government works...

Your argument seems to be that lowering taxes on ordinary people is impossible?

[embedding-shape]

> That's the false dichotomy that happens in a broken government, but then why hold that out as something desirable?

Personally I see it as stuff that happens in countries where the government care about the well-being of all, not just a select few (usually the ones with the most money). It's desirable that society improves, lots of that happens because of tax money. Subsidies usually means re-allocating funds, not raising taxes, although that might happen over time. Still, increasing taxes isn't inherently bad, especially when used for good. But I also know this is a somewhat controversial point of view in many hyper-capitalistic societies.

> Your argument seems to be that lowering taxes on ordinary people is impossible?

Yeah sure, I'm also clearly arguing for murdering children. Fun discussion, hope you'll enjoy the rest of your Tuesday :)

[AnthonyMouse]

I'm honestly having trouble comprehending what your position is supposed to be here. It really seems to be that using the money to lower taxes on ordinary people rather than providing them with subsidies is a thing that could never happen. As if the prospect that their taxes could be lower than they are now, rather than only the same or higher, is something you can't even imagine.

[pqtyw]

Well that would apply to a lot of thing governments spend money on. I think the idea is that governments are better at allocating capital in certain cases (obviously one might disagree with that) than the people/companies who generate the most tax revenue. I mean on an individual level even if solar batteries are profitable people who have sufficient disposable income might chose to invest it into the US stock market (if it still offers better returns) amongst other things than into something that benefits the Australian economy or society.

[abecedarius]

To target the "poor people need more money" problem, the most direct answer is give them money. If someone's answer is a variety of politically-allocated narrow subsidies, you should wonder what interest they're really aiming to satisfy.

When you get money, you can choose to spend it on what's worth the most to you. Thus "strings attached" on the opposite.

[budsniffer952]

That's a strange definition of "subsidy".

[throw0101a]

> If something actually saves money then it doesn't require a subsidy because people would be doing it regardless.

…assuming people are good at math.

And given that most people probably don't have a bunch of cash just sitting there doing nothing, they will have to take out a loan and most folks probably don't like going into debt even though 'the math says' it's a good ROI.

The idea that 'ROI good, therefore people will do it' is the 'spherical cow' of economics. In reality there are all sorts of other motivations for human economic actions:

* https://en.wikipedia.org/wiki/Behavioral_economics

* https://en.wikipedia.org/wiki/Homo_economicus

[mothballed]

To be clear, this doesn't change the price floor for ROI calculations. A non "approved" contractor or DIY job non-subsidized is well cheaper than a piddly few percent interest rate arbitrage to a pre-approved list. This does nothing beyond let some rich contractors regressively allocate money from taxpayers to themselves by artificially appearing a bit less of a premium to the alternatives.

It looks more like to me some installers saw their industry was becoming commoditized and the government got together with them to figure out how to grift taxpayers into making the more connected ones command a premium while simultaneously being better positioned to eat the lunch of the small middle class "guy and a truck" who does cash jobs for cheap but has no resources to become "accredited" on a subsidization list.

[BeeOnRope]

It can work when the marginal cost of new capacity is high, compared to existing capacity.

E.g., if the marginal cost of supporting 1 kW of new capacity may be X, while the current averaged cost of 1 kW provided to existing customers may be Y, with Y < X.

The customer will calculate their ROI on a battery purchase based on the cost Y of kW to them, which may be poor (4%), while on the government level of the ROI may is closer to that implied by the cost X (say 10%). However, the government cannot easily pass on the "marginal cost" to customers as there is no specific kWh which is that marginal one across all customers.

In this case a subsidy directly picks out customers who can reduce their demand by buying a battery (e.g., a subsidy which raises the ROI to somewhere between 4% and 10%).

[master-lincoln]

Think about people who could not afford the initial investment. It's beneficial for society here if the government redistributes wealth for the benefit of all.

[AnthonyMouse]

> Think about people who could not afford the initial investment.

This is what loans and installment plans are for, the payments for which come out of the savings on the utility bill.

> It's beneficial for society here if the government redistributes wealth for the benefit of all.

Which has nothing to do with batteries. If you want to do that then provide them with a refundable tax credit that allows for a negative tax rate in cases where that's deemed desirable.

And even that doesn't apply to the majority of people who are currently paying a non-negative amount of tax. Why attach strings to the money going to a middle class homeowner who should have just been allowed to keep that portion of their own salary?

[actionfromafar]

Why should they? In my mind it's all a coordination problem. Sometimes loans work better, sometimes subsidies work better.

Neither loans nor subsidies are dirty words IMHO.

[AnthonyMouse]

> In my mind it's all a coordination problem.

But that's the point. It isn't. Electricity costs more in the evening than during the day and there is a technology that can profitably be used to arbitrage the difference. There is no coordination problem at all, people have the direct individual incentive to buy the technology, on credit if necessary, without any form of government subsidy or involvement whatsoever.

[actionfromafar]

That cow is looking too spherical for my tastes. Credit is another thing which is highly intertwined with goverment involvement.

[AnthonyMouse]

Which has what to do with whether there is a coordination problem in this specific case?

[EliRivers]

"If something actually saves money then it doesn't require a subsidy because people would be doing it regardless."

Yet people frequently don't. This assertion and reality disagree.

[rswail]

Because the individualized incentives do not take into account the community benefits.

The money saved is distributed across the community, for both those that directly benefit and those that can't (eg renters, apartments etc). The general benefit is of greater value than the individual savings.

Your attitude that somehow taxation is theft is a very silly Ayn Randian Objectivism outgrowth that has never been true, even in the most "free" US states.

[AnthonyMouse]

> Because the individualized incentives do not take into account the community benefits.

Only if the utility company is pricing things incorrectly.

If the price of electricity is ~free during the day and expensive in the evening then the individualized incentives for installing a battery line right up.

> Your attitude that somehow taxation is theft is a very silly Ayn Randian Objectivism outgrowth that has never been true, even in the most "free" US states.

Whether it's theft or not doesn't change the arithmetic. When you're paying them the money they're paying you, it was your money to begin with.

[TheOtherHobbes]

Think of it as a giant corporate tax break, but for the little people.

[AnthonyMouse]

> Think of it as a giant corporate tax break

So the thing everyone correctly maligns because it's generally some form of corruption or inefficiency?