I realize that there is extremely large overhead with the oil industry and the $10.7 Billion doesn't all go into their pockets but Mobil's net last year was 8 Billion dollars.... And we hand them 4 billion a year (and $4.15 a gallon). Infuriating.
We don’t “hand” them anything. It’s an upfront tax break on the cost of exploration. By the way, you need to post a live link.
Lets see, Conoco Phillips.
11bl in earnings
8bl in US taxes
3bl in foreign taxes.
Yup, their profits are certainly obscene.
Their profit in terms of percent of sales is not out of line at all.
The last I read, something like 8.75%.
The big numbers come from big volume and if you have not thought about it, with big volume comes much much bigger risk.
For instance, if I sell you the only thing I own and it is in the back of my pickup, there is no risk to speak of. If I have to give it away, there was only one item. Unless it was a gold brick or a diamond the size of a bushel basket risk is not of the magnitude that will destroy me..
When you deal in millions of gallons of fuel and have manufacturing and distribution facilities all over the world, one mistake can kill you.
Besides, where does that “obscene profit” go?
What do they do with it?
Surely you don't think they keep it under the bed.
Buy more stock, maybe in the same company but likely split it up and buy into other companies.
Why is that important? Well think about when Lowe's was opening 20 or 30 new stores a year, as was Walmart.
Where did that money come from? Mostly from sale of stock.
If there is not a good return on stock, either in dividends or in appreciation in value, no one buys it and no new jobs are created.
Besides, if you have any investment program of any kind at all, it is very likely that there are some petroleum based companies in your portfolio.
Most people that rant and rave about “obscene profits” have zero understanding of how our system really works.
"The CEOs from the five major oil companies -- which together booked $36 billion in profits in the first quarter of 2011 alone -- went to the Senate on Thursday to try to justify the $4 billion in tax giveaways they're receiving this year."
You see, I know that for every dollar of profit, oil companies have paid about three dollars of tax. I also know that for the fourth quarter of 2010, Exxon-Mobil made a profit of about 2 cents on every gallon of gasoline sold, whereas the federal and state governments made over 50 cents "windfall profit" per gallon through taxes for doing absolutely nothing in locating, drilling, refining, and delivering the gas.
I also know that most of those "tax giveaways" go to small, independent oil companies, not the big corporations. I know that eliminating long standing tax deductions (the things you guys mislabel as "giveaways") will help big oil by eliminating competition. Hmm, which big oil company gave Barry Obama 20 billion to use for something that still hasn't happened? What is Barry planning to do with the loot? I know that Barry's favorite "green" technologies have received far more subsidies than the oil industry and they produce and will produce almost nothing of America's energy. So, in dollars spent for unit of energy gained, wind, solar, ethanol, and geothermal are among the biggest wasters of taxpayer money in the history of energy.
It's people in the millions seeing the ruin that Barry's Soros-directed policies have made of a strong and prosperous nation and determining that they're not going to be fooled again.
Something is happening.
It's the last grains of sand in the hourglass rapidly draining away. Get ready to find private sector employment.
Where were these Democrats complainingabout collusion when I was paying $1.38 for gas six months before Obama was elected?
Their profity margin is actually 6.2% which is relatively small in comparison to many other corporate entities that no one seems to bitch about.
What we hand them is no more or less then a lot of other companies. If you want to get mad, get mad at the Obama administration and the liberal progressive azzholes for refusing to open up areas for drilling along with the speculators that are also driving up oil prices. Oil companies don’t set the price of oil.
Microsoft : 31.85% profit margin.
McDonald’s Corporation : 19.78% profit margin.
JPMOrgan Chase : 17.86% profit margin.
Nike : 10.30% profit margin.
General Electric : 8.73% profit margin.
BP : 8.07% profit margin.
ConocoPhillips : 5.20% profit margin.
These arguments about “obscene” profits are completely stupid.
Hey, how about we limit the oil companies profits to the same percentage as the taxes charged by the US government?
Lets see, according to the DOE in Nov 2010, 14% of every dollar goes to taxes on gasoline. How about we limit Big Oil’s profits to 14%?
[research the profit margin of your “Big Oil” very carfully before you answer that question]
Then ask yourself, how much of the corporate tax burden is passed on to consumers to maintain that profit margin.
LOL ... yer getting hammered ...uh .. and not to pile on. but .. AND ANOTHER THING! Part of the “Big Oil Subsidy” nonsense is ...uh ... nonsense. The Big Boys haven’t used Depletion Allowances since 1975. That one is aimed squarely at the “Little Guys”.
Little Guys produce half of our domestic crude and they have no way of passing on the cost of a new theft (on the part of Government) to consumers. They will throttle back on production. I guarantee it.
They put almost all of it back into the ground. It is not like they have a giant vault somewhere. Also, the Intangible Drilling Cost right write off is the same manufacturing write off that manufacturers (like steel for GM cars, etc.) In addition, the Oil and Gas Industry pay more taxes than any other domestic industry. Most of the liberals know all of this, but they go to where the money is.
Big oil should stop selling to the dam gov., do an Atlas Shrugged on ‘em.
This is a perfect set up for crony capitalists and their whoring representatives. The representatives get lobbied (i.e. bribed) to do the bidding of those corporations that spend their profits bribing congressional whores. Those corporations that spend their profits on R&D, etc. are left to the vagaries of the market.
Changing the current system is near impossible. Anyone who suggests a tax rate reduction is accused of being a tool of the corporations. Anyone who suggests the elimination of a deduction or tax credit is accused of being a socialist.
A better idea would be to have a relatively low tax on gross receipts with no deduction of any kind or tax credits of any kind.
That way businesses would compete on quality of products/services and pricing rather than on government whoring.
Of course that will never happen, but one can always dream.
Blogpimp troll pong.
The economic illiteracy needed to buy into the idea that adding taxes to an industry that earns a paltry 6 to 7 % rate of return doing something absolutely essential to our well being and national defense because they make “too much” profit, which is about a third of all the taxes paid on what they produce, will somehow do anything but further ratchet up prices and hurt the economy is stunning.
(Hint: People can’t cut back on driving much more, so the price curve is reaching inelasticity, and the costs will just get passed on to the people at the pump - and those buying food, clothing, and everything else because most stuff is delivered to point-of-sale by truck.)
That so many Americans buy into is even more stunning.
That a Freeper, even a relative newbie, does is astoundingly stunning.
1) Since 1977, US oil companies have paid 584 Billion in corporate income tax.
2) Since 1977, ALL American oil companies have earned just under 600 billion in net profit.
3) Since 1977, American Oil Companies have collected and turned over 100% of additional fees and taxes to the Federal government, that were collected from consumers at the pump... in the amount of 1.27 TRILLION dollars! Now exactly who is ****ing whom?
What is infuriating is seeing otherwise rational people imply that the oil and gas industry is somehow dishonest or fraudulent for making a fair return on huge sums of capital invested at very high risk.
No one hands the industry anything; they are simply allowed to deduct real costs of doing business just like any other business. The way I understand the concept, income equals revenue less costs. What the democrats are attempting to do is tax these companies on money they did not make, because it was paid out to defray real costs.
Once again the media obligingly follows the party line and redifines a well understood term like “tax deduction” and begins to call it a “subsidy.” Before long, even people I once took to be sensible and conservative start smoking this dope, calling these tax provisions “loopholes.” Case in point, John (Bonehead) Boehner.
The fact is that these provisions are necessary to encourage investment of capital in a business where a $5,000,000 investment may be totally lost on a dry hole. To me it is amazing that the oil and gas industry has succeeded in keeping us as well supplied with oil and gas as they have.
I hate RATS. If I remember correctly, ExxonMobil paid an effective 47% tax rate - that is too high, and I hate anti-American, anti-Capitalist whining about people making a decent profit.