As turmoil rumbles across Latin America, energy prices have emerged as a potent flashpoint. Ask Ecuador’s President Lenin Moreno, whose government was almost toppled this month by protests against increases in the cost of gasoline and diesel fuel.
By now, this script is both tragic and familiar. In recent years, similar stories have played out in Argentina, Mexico and, most visibly, Brazil, where a trucker strike over higher diesel prices in May 2018 gridlocked the economy and forced the government to cave to protesters’ demands.
The culprit in all these cases was the same: fossil-fuel subsidies, which are widely regarded as wasteful, environmentally harmful and almost entirely ineffective. All too often, efforts to end them have ignored hard-earned experience, leading to avoidable economic disruption and civic unrest.
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