Last week, I explained why the Center for American Progress (CAP) was wrong to claim that large oil and natural gas companies like ExxonMobil receive “subsidies.” But CAP is not the only organization that plays fast and loose with language to the detriment of our public policy dialogue.

As Copenhagen Consensus director Bjorn Lomborg recently pointed out in The Wall Street Journal, the International Monetary Fund (IMF) is guilty of many of the same conceptual errors in the way it uses the word “subsidies.”

Earlier this year, Lomborg notes, the IMF released a report called “Energy Subsidy Reform – Lessons and Implications” that made a startling claim:

The organization announced in March that it had discovered an extra $1.4 trillion in fossil-fuel subsidies that everyone else overlooked. Of that figure, the report claims, $700 billion comes from the developed world.

How did the IMF get these numbers – numbers everyone else overlooked? Lomborg explains:

U.S. gasoline and diesel alone make up about half of the IMF’s $700 billion in alleged subsidies. Gasoline and diesel deserve more taxation, the report says, so the IMF counts taxes that were not levied as “subsidies.”

In other words, in a sleight of hand, the IMF builds into its analysis its own support for carbon taxation while distorting the meaning of the word “subsidy.”  Lomborg continues:

The assumptions behind the IMF’s math have some problems. The organization assumes a social price of carbon dioxide at five times what Europe currently charges. The air-pollution damages are upward of 10 times higher than the European Union estimates…

Finally, the IMF effectively ignores the 49.5 cents per gallon in gasoline taxes the U.S. consumer actually pays. The models cancel out this tax, inexplicably, with an “international shipping cost.” But even if you accept the IMF’s estimated pollution costs and the European-style VAT, the total tax the IMF says goes uncollected comes to only about 44 cents per gallon—or less than the actual U.S. tax of 49.5 cents per gallon. The real under-taxation is zero. The $350 billion is a figment of the IMF’s balance sheet.

So to pull the curtain back a little: The IMF thinks that a failure to add an additional layer of  tax on gasoline and diesel amounts to a subsidy to fossil fuel companies, while at the same time ignoring the taxes that are currently collected at the pump.

It should be clear that there is a lot of bias in such a calculation. It should also be clear that this has nothing to do with subsidies, which can best be defined as special financial support drawn from the public treasury and given to favored industries.

As I have explained many times, the largest investor-owned oil and gas companies not only do not receive subsidies from Washington, but on several issues – such as the Section 199 production activities deduction and the deduction for intangible drilling costs – we are specifically disadvantaged compared to other industries or smaller oil and gas companies.

One thing our policy debates need is clear language and straightforward discussion, not obfuscation and manipulation. If you can’t make the case based on the facts, your argument is surely lacking.