Well, the heads of the big oil companies got called before Congress yesterday to explain why the hell the price of gas is so high. And it wasn’t pretty.
I’d like to join the chorus of those slamming Big Oil. I’d really like to, especially since I’m probably gonna pour about $50.00 down Mongo’s gullet today when I cruise by the gas station.
But there are these stubborn things called “facts” that get in the way. So I’m going to skip slamming them around, and instead go after one of my preferred targets — politicians.
First up, let’s look at those “obscene” profits of Exxon Mobil. Yes, they made assloads of money last year. But they took in cubic assloads of revenues. It’s a matter of scale — if you make huge sales, your profits are likely to be huge, too — even if they’re only a small percentage.
Exxon Mobil’s profits last year were around 9% of total revenues. That’s pretty mediocre, especially when compared to a non-profit like Planned Parenthood, who made about an 11% return.
But Planned Parenthood isn’t a for-profit corporation, with publicly-traded stock. And it’s my understanding that a lot of Big Oil stocks are owned by retirement funds — whose owners are pretty much the demographic opposite of Planned Parenthood’s targets.
Here’s a cartoon that shows another appalling aspect of Congress’ little temper tantrum. I dearly wish that even one of the Big Oil CEOs had said “tell you what, Congressman — we’ll cut our profit markup in half, if you’ll do the same to your taxes.” After all, if Congress really wants to cut the price of gas, wouldn’t they be willing to take a bit less in taxes?
Nope. The big move is to INCREASE gas taxes, to “punish” people who drive fuel-inefficient vehicles (like me, with my early-90’s SUV).
OK, here’s another fun point. The Democrats (who ran this hearing) are big for pushing for American energy independence, for subsidies and tax breaks for alternate and renewable energy sources. A good chunk of those are given to — surprise! — energy companies, who are already set up to do that kind of work.
Energy companies like Big Oil, who were lambasted for accepting these bennies.
People are also awfully upset about the rise in the price of crude oil, which is currently over $100.00 a barrel. So, naturally, they are kicking the sellers of the oil for gouging.
Whoops, my bad. No, they’re kicking the BUYERS of the oil. The Big Oil companies are the ones who have to fork over that money per barrel, because they buy the crude, refine it, and then sell the products to us. So, essentially, we demand they convert the crude into the stuff we want, and get mad because the people who sell them the crude are making the oil companies pay through the nose for the crude.
Let me see if I can paraphrase Congressman Markey’s (D-MA) position:
“Big Oil, how DARE you pay huge prices for crude oil, refine them in old refineries because we won’t let you build new ones, distribute them all over the country, and sell them to the public, while making about 9% total profit? How DARE you, Exxon Mobil, pay more in taxes than the entire bottom 50% of American taxpayers combined? How DARE you allow the price of gas to reflect the fact that we, the government, take almost five times as much in taxes as you take in profits? How DARE you take over 15 billion dollars over ten years in tax breaks from us for developing nuclear power, renewable energy research, and fuel-efficient vehicles and buildings? And how DARE you actually raise the price of gas at the same time we’re talking about raising taxes on gas to encourage people to use less?”
Oh, those evil, evil, evil oil companies. I’m gonna call up my 401K plan manager and demand he sell off any stocks in them immediately.