Obama’s statement on big oil profits sets up a nice campaign theme
Thank God (or the FSM if you so desire) for elections. Because we still have elections, Dems still figure out how to be on the right side of an issue every once in a while.
Today, Members of Congress have a simple choice to make. They can stand with big oil companies, or they can stand with the American people.
Right now, the biggest oil companies are raking in record profits—profits that go up every time folks like these pull into a gas station. But on top of these record profits, oil companies are also getting billions a year in taxpayer subsidies—a subsidy they’ve enjoyed year after year for the last century.
Think about that. It’s like hitting the American people twice. You’re already paying a premium at the pump right now. And on top of that, Congress thinks it’s a good idea to send billions more of your tax dollars to the oil industry?
It’s not like these are companies that can’t stand on their own. Last year, the three biggest U.S. oil companies took home more than $80 billion in profit. Exxon pocketed nearly $4.7 million every hour. And when the price of oil goes up, prices at the pump go up, and so do these companies’ profits. In fact, one analysis shows that every time gas goes up by a penny, these companies usually pocket another $200 million in quarterly profits. Meanwhile, these companies pay a lower tax rate than most other companies on their investments—partly because we’re giving them billions in tax giveaways every year.
In addition to the simple choice that is presented, I love the fact that Republicans are spoiling for this fight. The GOP is so hopped up on its own rhetoric, that they really believe that they can convince voters that oil companies need billions in taxpayer welfare.
If the subsidies go away, what’s to stop the 5 oil companies from hiking up prices until the profits come back?
not saying we shouldnt pull their welfare, I just know how these bastards work.
“If the subsidies go away, what’s to stop the 5 oil companies from hiking up prices until the profits come back?”
The fact that when gas prices go up, people buy less of it.
His fight against oil companies is sheer hypocrisy. Obama said that no option for solving our energy problems was off the table but now he wants to implement his unilateral policies including a number of short-term solutions that can hardly be successful. Moreover, there are other natural resources we are gradually running out of and little attention has been paid to it thus far. I was surprised when I read about certain kinds of natural resources which are not so well known but whose depletion would pose a serious problem for some industry sectors especially for the world of information technology. I am really concerned about whether the scientists will be able to find an effective solution to this problem other than the devastation of one of Earth’s most valuable natural resources – the ocean as suggested in the article. How does Obama want to solve these problems?
This is especially good since polls pretty consistently show that Americans want these subsidies to end.
The conundrum for oil companies is that the price is largely determined in the global marketplace — not just by local consumption. So the real long term impact for them is to shareholders who won’t find their shares quite as profitable without the government subsidy.
Thanks for the link. I’m surprised it is as high as 74%. I guess I’ve come to think of the percentage of Republicans who reflexively opposed to things that make sense as a little higher than that. I have to remind myself that they are loud but not large in number.
When gas prices go up, people actually don’t buy less of it in the short term. It’s an inelastic good. Over the longer term, though, people are more likely to decrease consumption of gas as prices remain high.
“When gas prices go up, people actually don’t buy less of it in the short term. It’s an inelastic good.”
What’s the “short term”? Last time gas hit $4/gallon, consumption dropped 5% in the next 12 months, and the drop started almost immediately.
“Obama said that no option for solving our energy problems was off the table but now he wants to implement his unilateral policies including a number of short-term solutions that can hardly be successful.”
The oil companies are making record profits. Assuming that this $4 billion goes directly to the bottom line, it will trim their aggregate profits by something on the order of 2%. That’s the amount you’re getting hysterical about.
As for what you linked to, I hope you realize the difference between basic chemical elements like phosphorus and rare-earth metals, and petroleum, which is made up of incredibly complex molecules. We can, if necessary, synthesize oil from coal, and someday will when extracting crude oil gets more expensive. You can’t make more phosphorus or rare-earth metals.
At any rate, what exactly do you want the administration to do about shortages in those substances?
And the drop in gasoline usage is still declining here in the US, in spite of the economy picking up a little bit. That suggests that the habits of convervation are becoming ingrained.
Cass: Cash for Clunkers played a role, too. As soon as we cross the $4/gallon Rubicon this time, you should see another drop in usage as more people look for better-mileage vehicles.
One thing conservatives never acknowledge about oil prices is that conservation can subtract millions of barrels of demand from the market, putting just as much downward pressure on prices as increased supply would.
The nice part about gas prices going up is that the increases impact “red” states disproportionately. So-called “conservatives” drive less fuel efficient vehicles and live farther away from where they work.
i love how conservatism and conservation are pretty much opposites. It’s a conservative idea to use all the resources you can so no one else does. morons
So Senator Obama was for subsides for oil companies before President Obama was against them?
Jason, where do you think your food comes from? Pegasus food delivery with solar panels on their wings?
Rising gas prices hurt everyone, particularly the most vulnerable among us.
Are you trying to tell me that food doesn’t come from solar powered Pegasus food delivery?
I count Cash for Clunkers as a conservation measure — replacing vehicles with lower mileage ones definitely makes a dent in the reduction of gas usage since the onset of the Great Recession. Another thing I think is making a difference is fewer business trips by business trip types. There are lots more webinar-type meetings going on and on-line collaboration. You can see airlines like USAirways relying more on regional jets and even downsizing the number of flights in and out of some cities as part of the reaction to fewer flyers. I’m guessing at that though — mainly because I’m on more regional jets these days and have less of a selection of travel times to choose from.
Rising gas prices hurt everyone, particularly the most vulnerable among us.
As if you give a damn about the most vulnerable among us. Excepting when you can try to use them to make a trite point.
Cassy,
Who anointed you clairvoyant seer for all?
Regardless, my point IS spot on. Is it not?
I already told you if wasn’t spot on. Which IS how you could tell if you bothered to read.
“Are you trying to tell me that food doesn’t come from solar powered Pegasus food delivery?”
oh man…. DD, Pan, i think it’s time Jason gets the Santa Clause, Tooth Fairy, Moral Conservative talk.
He can’t be gone fast enough.
He is a one-man bureaucracy.
Instead of an energy policy to protect our national interests, he seeks blame with the oil companies. Obama is clearly not prepared to be the President of the United States, even after almost 4 years on the job. I think he’s arrogant and stubborn. And you can’t possibly that stubborn without being stupid too.
“Instead of an energy policy to protect our national interests, he seeks blame with the oil companies.”
Revoking a $4 billion tax break is not “blaming” anyone. He’s saying it’s unnecessary to companies earning record profits. Why is he wrong?
“I think he’s arrogant and stubborn.”
I daresay no president has ever lacked these qualities.
“And you can’t possibly that stubborn without being stupid too.”
While you yourself are certainly strong evidence of that statement, you are not proof. Would you say Churchill was stubborn? Was he also stupid?
“So Senator Obama was for subsides for oil companies before President Obama was against them?”
So was anyone with any sense. They were passed during the price doldrums of the ’90s, I believe, when depressed prices dried up oil company profits and left them with the shorts when it came to funds for exploration.
That’s no longer the case. Sometimes a subsidy makes sense short-term. That’s no reason to continue it during boom profit times. If the oil business falters again, we can bring them back.
This is simple common sense. What’s wrong with you people?
Im curious, what subsidies are the oil companies recieving that other busineses are not? All businesses recieve the right to write off and depreciate expenses and equipment? No more than you and I recieve the subsidy of writing off the interest to our mortgages?
Just show me what you are talking about, this will help me form an opinion.
Thanks
@wc “Just show me what you are talking about,”
They get a large depreciation allowance on the wells themselves.
It would be like you buying a forest cutting down and selling trees and then getting an allowance because your property is worth less without trees on it. It’s a HUGE giveaway that no other industry has.
LE, so its the depreciation on the wells thats the subsidy you are talking about? How much is it? Is it different than other companies depreciation schedules?
http://hotair.com/archives/2011/05/03/oil-company-subsidies-clarified/
So is this what you are talking about? the depreciatioin you talk about is not allowed to companies that both refine and drill but only to the companies that drill (which is not big oil)
so I am still lost?
You are lost. An industry written paper that justifies its taxpayer handouts isn’t the most credible source in the world and the fact it comes from the aptly named Hot Air doesn’t help it in the credibility sweepstakes.
cassandra, they why dont you show me where the subsidies are coming from? That would be one way of debating. thanks
what about this from the CBO?
http://www.cbo.gov/sites/default/files/cbofiles/attachments/03-06-FuelsandEnergy_Brief.pdf
I see $2.5 billion here for the entire Oil Industry. So because the companies have tremendously large revenues, and their percentage of profits is smaller than most in the manufacturing industry, you want to cut their ‘subsidies’ that other manufacturing companies enjoy?
I love how eager Republicans are to be on the wrong side of this.
No kidding. Whatever happened to not picking winners and losers?
I have a different take on it. Profit is good for the economy. Lots of profit is great for the economy. I say lets hire the oil companies to help other industries become profitable. Ie, housing, manufacturing, even government. If all these industries became profitable, the economy would be much better off. Employment would rise. If you say the oil companies profits are not helping you personally, simple answer, either buy stock in them, or get a job with them.
Yeah, that’s why the past ten years have seen such terrific economic growth. The record profits are being turned into jobs for Cayman Island accountants.
Yiu have no idea how idiotic your different take sounds to people who are aware of what is going on.
What makes you think oil people know anything about housing ,manufacturing or government?
Profit is good for the folks who profit, and the industry only has so many jobs. Profit is only good for the economy when said profits are spent in the economy.
Jason, “you have no idea how idiotic your different take sounds to people who are aware of what is going on”- explain 1- who are the ‘people’, 2- tell me what is going on?
I see oil companies that employee US citizens (and to make you happy maybe some illegals), the have the same ‘subsidies’ that other manufacturing companies are allowed, (I still havent seen any proof of ‘other subsidies’, they make a profit, at a lower rate to their income than most other manufacturing companies, and their stocks, which most of us have in our 401k plans, have done well.
Exxon/Mobil and the other ‘big oil’ companies income are some of the largest in the world, but so are their expenses. you need to look at the ratio of profit/income.
Or would you rather have the government, as you put it ‘subsidizing’ companies that arent making a profit, and then go out of business, thus losing the goverment subsidy.
I have yet to see one bit of proof of what subsidies you are talking about. All that I have heard is that you are smarter than me.
PS I am not a republican, so stop inferring, it makes you look stupid
Cassandra, not picking winner and losers. Isnt that what Obama is saying with his statements. He is picking Solendra over US based PROFITABLE companies. And he is saying that Oil is a ‘loser’.
@HY “Cassandra, not picking winner and losers. Isnt that what Obama is saying with his statements. He is picking Solendra over US based PROFITABLE companies. And he is saying that Oil is a ‘loser’.”
But the field is currently NOT level… not at all. Please read this piece by Arnold Schwarzenegger:
“An unfair fight for renewable energies”
http://www.washingtonpost.com/opinions/an-unfair-fight-for-renewable-energies/2011/12/02/gIQA9lWrTO_story.html
He articulates it better than I can….
@HY “I have yet to see one bit of proof of what subsidies you are talking about.”
Honestly… this has been all over the news. Here’s a few recent NYTimes things:
http://www.nytimes.com/2012/03/31/opinion/big-oils-bogus-campaign.html
http://thecaucus.blogs.nytimes.com/2012/03/29/obama-repeats-his-call-to-end-oil-subsidies/
http://www.nytimes.com/2012/03/02/us/politics/obama-calls-for-an-end-to-subsidies-for-oil-and-gas-companies.html
Oh.. and it’s either $4 billion or $2.5 billion depending on exactly what’s being considered. And these are special tax breaks enjoyed by only the oil industry. Those folks bought numerous Congress critters to get these corporate pork tax breaks at the expense of the American people.
Do you like paying for oil used by other people???? I don’t.
The 25%ers who are hard core conservative freaks really think that they have a winning issue beating up Obama on clean energy while sticking up for the poor little oil companies.
It is astonishing, but the wingnut echo chamber has them thoroughly convinced that they are going to ride this thing to electoral Valhalla.
Maybe the wingnuts want a system where all gasoline costs are paid for by tax dollars… They’d be all over that in a Tea Party minute…
..but wait. Isn’t that just like WELFARE?? Isn’t that BIG GOVERNMENT??
Their hypocrisy is stunning.
Furthermore, it is those same noisy 25%ers who think that allowing health insurance companies to deny cancer patients insurance on the grounds of “per-existing conditions,” is something’s that America is clamoring for.
And they have a point. If Democrats get scared by all the noise, the super PAC ads, and nonstop Fox News stories about the poor little insurance companies, then have shown the ability to turn unpopular policies into winning election day issues.
LE, You at nt far from the truth. In the teabag mind, the highest and best use of tax money is direct payments to CEOs.
Oil companies are not manufacturing — they are in the extraction, refining and transportation business. President Obama doesn’t think that oil companies making alot of money is a bad thing. He does think that oil companies making record amounts of money no longer need any taxpayer help to be successful.
It’s gonna be fun to listen to these teajadis justify why oil companies should not be on their own in the free market.
So exxon rev $115 billion, net income $9.4 billion. Apple rev $46 billion, net income $13.4 billion. Does Apple get any tax breaks? All manufactuers do.
I am not asking for you to post opinion post from liberal NYTimes, Washington Post. They are nothing but opinions.
What I am asking is what specific subsidies to the oil industry, specific the refining side, get that Obama wants to eliminate.
Can you point me to that?
Also, Jason, wtf are you talking about, we are not talking about Health Care here. Please dont deflect. Stay on point.
You keep proving the point of this post. It is about how eager Republicans are to fight the good fight on behalf of oil companies that are racking up record profits. The health care comment was an analogy. You are going to have to look up “analogy” is you want to crack that mystery. I’m not doing any hand holding.
Jason, one more time, show me where and what subsidies the oil companies are getting that other manufacturers or businesses are not?
And so if you grew your company to twice its size, should you lose some of the ‘subsidies’ , tax breaks that you are afforded today?
BTW again, and I will hold your hand here. I am not a Republican.
Sorry Republican guy. You are on your own. Puzzle it out. Think it through, the learning has a better chance of sticking that way. Read the whole initial post again if you get stuck.
@HY “I am not asking for you to post opinion post from liberal NYTimes, Washington Post. They are nothing but opinions.”
What a crock. Two of those were NEWS reports, not opinion pieces.
@HY “What I am asking is what specific subsidies to the oil industry, specific the refining side, get that Obama wants to eliminate. Can you point me to that?”
Uhhh. Sure can. That’s as easy as pie. And easy to find with a one minute google search.
Here’s exactly what they were voting on:
http://www.govtrack.us/congress/bills/112/s2204/text
What game are you playing at? Is it really so hard for you to find VERY basic information that’s been all over the news?
Check out Six Pacque himself on the energy issue:
http://online.wsj.com/article/SB10001424052702303816504577309660763228238.html
Count the whoppers.
Let me hold your hand here, HY — if you come here with wingnut talking points and citing wingnut blogs who cite bought and paid for industry papers to make a dumbass argument that anyone with Google can see isn’t true — this makes you Republican.
Through and through.
The only people dumb enough to buy your BS are found on that hotair site you think is ohsocredible.
“show me where and what subsidies the oil companies are getting that other manufacturers or businesses are not?”
Which are you, lazy or stupid?
http://en.wikipedia.org/wiki/Energy_Policy_Act_of_2005