Updated: 09 June 2023

What Does Subsidization Mean?

Subsidization is the process where one party receives financial aid from another party, typically a government. It is often set in motion when the government believes that there is real need or that the population will be better served. Because subsidies are paid for with tax dollars, it is usually elected officials who make decisions regarding who gets subsidies. Certain health coverage is subsidized, and lower-income individuals and families may be eligible to receive health care subsidies to help pay for health insurance.

Insuranceopedia Explains Subsidization

Subsidization can be applied to many different sectors, such as public transportation, farmers, food, housing, and more. On the political spectrum, members of the left tend to support subsidization more than members on the right. Many republicans and conservatives believe that tax dollars should not go to subsidies and that people and corporations should instead find ways to cover their own costs.

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