“Nothing is easier, or more emotionally satisfying, than blaming high prices on those who charge them, rather than on those who cause them.” –Thomas Sowell
(AP) The House approved $18 billion in new taxes on the largest oil companies Wednesday [Feb. 27] as Democrats cited record oil prices and rising gasoline costs in a time of economic troubles.
The money collected over 10 years would provide tax breaks for wind, solar and other alternative energy sources and for energy conservation. The legislation, approved 236-182, would cost the five largest oil companies an average of $1.8 billion a year over that period, according an analysis by the House Ways and Means Committee. Those companies earned $123 billion last year.
Senate Democratic leaders said they would put the bill on a fast track and try to avoid a Republican filibuster. The White House said the bill unfairly takes aim at the oil industry. President Bush is expected to veto the legislation if it passes Congress.
House Majority Leader Steny Hoyer, D-Md., noted it was two years ago, when oil cost $55 a barrel, when Bush said oil companies need no government subsidies to pursue more oil or gas.
“With the price of oil hovering around $100 do we really believe this incentive is justified?” asked Hoyer. “Do these companies need taxpayer subsidies to look for new product? They don’t need any incentive.”
Republicans said the measure unfairly targeted a single industry.
“It punishes the oil and gas industry. This is wrongheaded. It will result in higher prices at the gasoline pump. It’s spiteful and wrong,” said Rep. Jim McCrery, R-La.
Is it rocket science that, when oil prices hit new highs, gasoline prices also hit new highs? Do you think the price of wheat could double without the price of bread going up? Would we have politicians running around spouting off about “gouging” by Big Wheat?
No matter how big American oil companies are, there are other oil companies around the world and the price of oil is determined in international markets. As for investigating Big Oil, that has been done time and again already, with nothing to show for it.
Is it rocket science that, when huge countries like India and China have rapidly growing economies, their demand for oil goes up by leaps and bounds? Is it rocket science that, when demand shoots up but supply doesn’t go up as much, prices rise?
Prices are a symptom of an underlying reality. Politicians can seize on the symptom and even pass laws dealing with it, without changing the underlying reality.
Prices are like a thermometer reading. When someone has a fever, it is not going to do any good to put the thermometer in ice water to bring down the reading. If you think the fever is gone, it may not be long before the patient is gone, if you don’t do something about what is causing the fever.
Ironically, the people who are making the most noise about the high price of gasoline are the very people who have for years blocked every attempt to increase our own oil supply. They have opposed drilling for oil off the Atlantic coast, off the Pacific coast, or in Alaska. They have prevented the building of any new oil refineries anywhere for decades.
They have fought against the building of hydroelectric dams or nuclear power plants to generate electricity without the use of oil. They love to talk about their own pet “alternative energy sources,” without the slightest attention to what these would cost in terms of money, jobs, or our national standard of living.
Even when one of their pet “alternative energy sources” — windmills — is proposed to be built near them, suddenly it is not right to spoil their view.
Politicians have indulged these spoiled brats for generations. Now, when the chickens come home to roost, they are screaming about high prices and Big Oil. That is world class chutzpa.
Corporate profits receive a lot of media attention, but what receives considerably less attention are the corporate taxes paid on corporate profits. Do a Google search for “Exxon profits” and you’ll get about 8,000 hits. Now try “Exxon taxes” and you’ll get a little more than 300 hits. That’s a ratio of about 33 to 1.
I’m pretty sure that Exxon’s tax payment in 2007 of $30 billion (that’s $30,000,000,000) is a record, exceeding the $28 billion it paid last year.
By the way, Exxon pays taxes at a rate of 41% on its taxable income…
In other words, just one corporation (Exxon Mobil) pays as much in taxes ($27 billion) annually as the entire bottom 50% of individual taxpayers, which is 65,000,000 people!
Oil traders: While often blamed for pushing up prices, traders don’t necessarily benefit from the high price of crude or gasoline; they profit from how much the price changes. Traders can get rich - as long as they bet correctly on whether prices will rise or fall…
Gas stations: A surprisingly small amount goes to the guy who runs the station.
Most service stations are independently owned and operated and take in between 7 and 10 cents for every gallon they sell…
Taxes: The government takes about 40 cents right off the top, with about 18 cents going to the feds. State taxes vary widely, but the national average is about 22 cents a gallon.
Transportation: Getting the gas from refineries to service stations via trucks or pipelines - and the cost of storing it in large tanks - eats up another 23 to 26 cents per gallon.
Refining: About 24 cents a gallon goes to refining companies like Valero, Sunoco or Frontier that specialize in turning crude oil into gas…
Profits for refiners have been squeezed lately because the price they pay for oil has risen so much faster than the price they can sell the gas for. This helps explain why Big Oil companies -like Exxon, which actually buys more crude oil than it produces - haven’t seen their profits rise as much as the price of oil.
Crude oil: This is the most expensive part of a gallon of gas. Of every gallon of gas $2.07 from every gallon of gas goes to producers of crude…
EIA estimates it costs U.S. oil companies an average of about $24 a barrel to find, develop and produce oil worldwide, but that doesn’t include costs like transportation, administration, or income taxes - which can be substantial. While Exxon made $40 billion in 2007, a 60% increase from 2004, it paid $100 billion in taxes and royalties.
The Rev. Jeremiah Wright, Obama’s pastor for the last 20 years at the Trinity United Church of Christ on Chicago’s south side, has a long history of what even Obama’s campaign aides concede is “inflammatory rhetoric,” including the assertion that the United States brought on the 9/11 attacks with its own “terrorism.”
In a campaign appearance earlier this month, Sen. Obama said, “I don’t think my church is actually particularly controversial.” He said Rev. Wright “is like an old uncle who says things I don’t always agree with,” telling a Jewish group that everyone has someone like that in their family.
Rev. Wright married Obama and his wife Michelle, baptized their two daughters and is credited by Obama for the title of his book, “The Audacity of Hope.”
An ABC News review of dozens of Rev. Wright’s sermons, offered for sale by the church, found repeated denunciations of the U.S. based on what he described as his reading of the Gospels and the treatment of black Americans…
In addition to damning America, he told his congregation on the Sunday after Sept. 11, 2001 that the United States had brought on al Qaeda’s attacks because of its own terrorism.
Video: a few samples of Barack Obama’s “spiritual mentor” in action (STRONG LANGUAGE WARNING).
WASHINGTON – U.S. Senator Lindsey Graham (R-South Carolina) today made this statement on comments by Senators Hillary Clinton (D-New York) and Barack Obama (D-Illinois).
“Senator Clinton made an interesting statement last night. She said, “We’re ready to end the war in Iraq and win the war in Afghanistan.” No one doubts we must win in Afghanistan, the country that gave rise to the Taliban and Al Qaeda. But Senator Clinton’s Iraq statement about “ending” the Iraq war was quite troubling.
“I realize the political left in our country does not want to hear the word ‘win’ mentioned in a conversation about Iraq, but our own national security interests require us to ‘win,’ not simply ‘end.’ It really is a bit unnerving to me that Senator Clinton would not understand consequences of losing in Iraq.
“Iraq is clearly a central battlefront in the War on Terror. Winning is not only now possible, but necessary.
“Last night, Senator Obama eloquently described how a grandfather living in Uganda was following the American presidential election. He was right. The world is watching and that audience includes some of the most vicious killers known to mankind. Al Qaeda is taking measure of each and every word uttered.
GENEVA (Reuters) - Islamic states are bidding to use the United Nations to limit freedom of expression and belief around the world, the global humanist body IHEU told the U.N.’s Human Rights Council on Wednesday.
In a statement submitted to the 48-nation Council, the IHEU said the 57 members of the Organisation of the Islamic Conference (OIC) were also aiming to undermine the 1948 Universal Declaration of Human Rights.
“The Islamic states see human rights exclusively in Islamic terms, and by sheer weight of numbers this view is becoming dominant within the U.N. system. The implications for the universality of human rights are ominous,” it said.
The warnings have been coming in for years. In June 2004, border patrol agents arrested 77 “Middle Eastern” men attempting to enter the U.S. illegally. Congressman Solomon Ortiz (D-Tex.) said that such attempts are “happening all over the place. It’s very, very scary.” In October of that year, intelligence officials began investigating allegations that 25 nationals from another hotbed of jihad, Chechnya, had crossed into the country across the Arizona border. And the next month, a captured Egyptian jihadist named Sharif al-Masri told interrogators about Al-Qaeda’s plans to “smuggle nuclear materials to Mexico,” where “operatives would carry material into the U.S.” A Bangladeshi Muslim, Fakhrul Islam, was arrested in December 2004 while trying to cross into Texas from Mexico. With him were members of the Central American Mara Salvatruchas gang, which some officials allege has ties to Al-Qaeda.
In June 2005, the FBI uncovered an operation dedicated to smuggling Iranians into the United States from Mexico. Five months later, Congresswoman Sue Myrick (R-NC) said: “They just arrested, down on the border, a couple of weeks ago, three al-Qaeda members who came across from Mexico into the United States.” And in December of that year, immigration crusader Congressman Tom Tancredo (R-CO) revealed that 51 illegal immigrants were arrested on terror-related charges between October 2004 and December 2005. In November 2007, the FBI issued an advisory about a plan by jihadists in league with Mexican drug lords to cross the border via underground tunnels and attack the intelligence training center at Fort Huachuca, Arizona, twenty miles from the border with Mexico. “The Afghanis and Iraqis,” one official explained, paid the Mexicans $20,000 or “the equivalent in weapons” for their help in getting into the U.S., and “shaved their beards so as not to appear to be Middle Easterners.”
If all this isn’t an argument for border security, what is?
Robert Spencer’s latest Jihad Watch video:
This cartoon was originally posted on July 16, 2007.
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