Poll: windfall profits

[Ron Wenrich]

Poll ends 2-27-06

The last quarter, oil companies made something like $10 billion in profit, and $36 billion for the year.  Too much?

[Don_Papenburg]

I voted NO  because  I would not want my profits taxed extra  If I ever had a windfall.   

[SwampDonkey]

Not as long as they're paying their share.  ;)

[ellmoe]

   Due to circumstances beyound my control I've had a "windfall loss" before. I don't recall the government pitching in to help then. I sure wouldn't want them trying to take any "windfall profits" from me. The increase in fuel prices drove down demand, and then prices came back down. I think the market worked. Beside the ROI is not that great for the oil companies anyhow, it's the volume that makes it impressive.
Mark

[GHRoberts]

I must own some oil stock in a mutual fund.

We have several clients who own a lot of oil. They spent a lot of money for a lot of years before they made much. Now they are richer than God.

I don't want to tax them.

[farmerdoug]

I would never vote for the government to decide to tax windfalls.  How would it be determined what a windfall is?  What if you only make 50,000 a year and your parents die and leave you an estate worth 500,000 dollars.  With today's land prices that is very common.  Now since you only make 50,000 a year that would be a windfall so the government takes half and then still makes you pay taxes on it then that would be okay, right?  I think not.

Windfalls are only there because of shortsightedness of others.  The government might as well tell you what you can sell your wood for and what everyone else sells their stuff for then we will be USSR II.

Farmerdoug

[Onthesauk]

How about if you phrase the question, "You have a couple of hundred acres of marketable timber and lumber prices go up ten fold.  Should you pay windfall profit tax on that increase in profit?"  It's really just a matter of degrees.  They have an inventory of oil in the ground that they have invested in over a period of time, kind of like growing trees.

[Bill]

Even though the buggars made a pile of moula I'd say no -

There was a show the other night that gave me something to think about. If you buy bottled water you're paying way more than $3 gallon. Ditto for many other consumer type goods. Bottled water costs zilch to produce compared to oil well, oil tanker, oil refinery, oil distributor, oil truck, EPA reg's, gas station and still under $3 gallon.

I sure wish it cost less but I don't want the govt deciding that they can create wind fall taxes when they think they can get away with it.

Of course I'm now driving that diesel VW at 40-55 mpg and will look into biodiesel given some time when I don't need the truck. A friend also raced dirt track cars back in the 70's on straight alcohol - he showed me the motor at the end of the season and zip for build up or wear inside the engine - near as I recall the byproducts for alcohol combustion are h2o ( water ) and co2 ( carbon dioxide ) . Seems to me we have a few choices not quite politically correct. ( I guess they don't want us to drink our fuel  ;D  )

[Paschale]

Well, I'm very suspicious of the gas companies right now.  There was an interesting report on the news a few months ago, comparing profits when gas was close to around $1.35 on average, and then comparing profits of the gas companies now where the average has been over $2.00 a gallon.  The oil companies are making more than ever before...it was almost double what they were making when the average was much lower.  Seems to me like a serious case of gouging, using Katrina and Iraq as an excuse to get the price higher so the shareholders can make more money.  I'm all for capitalism, but this sort of seems suspicious--I think that there's been some serious collusion on pricing going on behind the scenes.  I wish Elliot Spitzer would do an investigation of the gas companies.   :

[wiam]

I voted no because I think........  ok ok my grandmother gave my kids abunch of petroleum stock.

Will

[DanG]

I vote no, as well, but I have other plans for the big companies.  First, I gotta wonder how much of the profits are actually going to the shareholders.  I own stock in a major corp that brags about their profits, but I don't see any of it. ???  I am retired from that same company and I have absolutely no benefits except my wimpy little pension check, and I'm worried about that!

I think the Gov't should tax the living daylights out of the greedy buzzards, then give them a generous deduction for taking care of their employees and retirees.  I don't know of a single big company that is in trouble because of the line workers.  ALL of the big booboos are being made in the Boardroom, and those are the ONLY people who are being taken care of! >:(

[Tom]

hear hear !

[Brad_S.]

I wish Elliot Spitzer would do an investigation of the gas companies.

Sorry Paschale, he's much too busy gearing up for his run for Governor.

[CHARLIE]

I voted NO!  More taxes is not a solution to anything.  Companies and individuals are taxed enough.  And...companies are already taxed on their profits.  Maybe close some loopholes in the tax structure or go to a flat tax.

[isassi]

Come on guys! The "big oil" companies didn't dream up these windfall profits overnight. Seems like everyone fails to notice we have commodity traders in Chicago, buying and selling futures based on the whims of news and speculation on weather. I don't like the idea a guy can buy or sell a future contract for hogs or wheat, or even gasoline, and affect what we will pay 6 months later, but that is how it is. If we were in a worldwide shortage of beef, would anyone want to tax a farmer who was having a calf crop hit the market at the right time? We are in a market driven economy. That is what capitalism is all about. The price of oil products would drop if demand eased up. I drove a 1960 Ford pick-up to high school in '77, that I bought and paid for myself. I noticed the other day driving by the school parking lot, there were at least a dozen vehicles in the area students park in newer and more expensive then my diesel. Small town here, I know most everyone. And the point is, these kids are driving when it isn't needed, and those vehicles pump the demand for fuel, driving up prices. And then, when demand isn't enough, a pit trader in Chicago decides to speculate on a storm at sea, and we pay higher prices.... :

[crtreedude]

I voted no because the oil companies are going to have to reinvest a lot of the money in technology to extract oil that is harder to come by. If they don't, it will be taxed as profits, which most companies work very hard at trying to keep low.

[submarinesailor]

Working at the Defense Energy Support Center, I read A LOT of industry trade rags.  And crtreedude hit it dead square on the head.  If they do not re-invest the money into exploration and process, E&P money, than they will be taxed to death on their profits.  Oh, BTW I hate the BIG oil companies as much as you guys do.  But, I am all for the America way/dream.

Bruce/subsailor

[Cedarman]

I voted no also.  Big profits today can always turn into big losses tomorrow.  Big profits give lots of incentive for others to invent ways to cash in.  That in turn should lower fuel costs in the future.  If it doesn't, we will invent ways to conserve and use less of it.  If we all do our part to conserve, we will keep for ourselves some of that profit.

[crtreedude]

Keep the law too so that if they do reinvest it, it won't be taxed - which means lots of new jobs usually.

One of the things that was a jaw-dropper for me down here in the Socialistic country of Costa Rica (their words) is that profits ARE NOT TAXED!

My capitalistic heart just beats a little faster on things like that.

Honest, at the end of the year, we are permitted to remove profit and use it without taxation.

Now, when you spend it, it is taxed. The tax code here is pretty simple. Spend, and it is 13% tax. Make more than a certain amount, that is taxed (and not a really bad rate either). Health and retirement are manditory taxes. Environmental (and road) taxes are tied to fuel.

All pretty basic - oh, and the Ticos make an art form out of avoiding paying any tax.

[flip]

If, no, when more bio diesel and ethanol are used demand for gas products will go down and so will the price and profits. (or as least they should)  I hate to see someone taxed because they did good, but.   The fuel suppliers are in a bit better position to control profits, they charge what they want.  Kinda like if your city started charging a premium for your tap water, just because they could doesn't mean they should.  I have no good answer except that those that make more should be taxed more.

Flip

[thedeeredude]

More taxes is slower growth.  I have no grievances against oil companies.  They're just like any other business in America, some person saw a market and made his money there.   My solution, a team of belgians and an old farm wagon, is now a 1 ton truck.  A morgan horse and a phaeton are economy cars.  And they all run on fuel made here in America.  Not only that it would create more jobs, someoene would have to pick up "road apples" :D

[Cedarman]

The incentive to make more has gotten me to grow a business that provides full time jobs for 14 families. If I am going to be taxed more because I make more, then I might as well go back to being a one man show, make what I can because any thoughts of getting wealthy are down the drain.

Our problem in this country is not that we pay to little in taxes, it is that the govenment spends too much because every Tom, Dick and Harry wants a bunch of freebies and they just cant stand the thought that someone else gets more goodies than they do.

I do not begrudge some else's profits, so don't begrudge me mine.
A few years ago I had a piece of property for sale. A couple was interested in it until I priced it. They said, "We know how much you paid for that and we won't pay that much". They just couldn't stand to see me make that much profit. Six months later I sold it for 30% more than I first priced it.  Also to this day I have never referred anyone to their business, always to their competitor.

I am much more concerned about my profits to worry about how much some else makes.

[Kirk_Allen]

NO, NO, NO.  Did you hear me? NO >:(

[crtreedude]

Watch out - Kirk is going to hose someone down with the nozzle if they aren't careful! 

[scsmith42]

Cedarman - well stated!

The media has been really sneaky about focusing on the dollar amount of the oil companies profits. What they are not showing you is the net profit percentage amount..., which has not gone up by a "windfall".

Oil prices are impacted by futures traders, local distributers, as well as our insatiable appetite for oil.  Last year when the prices here in North Carolina approached $3.00, it got my attention and I started paying more attention to seeking ways to reduce my fuel consumption.  I was stunned though by the fact that very few other people did anything more than gripe about the cost.  I would still see most folks zooming 75 - 85mph down the road, wasting fuel.  There was no noticible decrease in traffic...

Why should the oil companies be punished because of our wasteful ways?  Should we punish ourselves in the future by reducing their ability to invest in more R&D, exploration, ect - ie creating jobs and expanding the economy?  I don't think that this would be the intelligent choice...

I do not agree with the premise of taxing them more.  Sopmething like 45% of our current federal budget already goes to entitlements (and I have a copy of the Constitution on my wall and the founding fathers vision was not for a socialized nation), we do not need to feed this monster more.

In almost every instance, when taxes are reduced companies and the general population spend more, thus expanding the economy and creating jobs (and new tax revenue sources- duh!).  Increased taxation only hurts us - lowering rates and expanding the tax base helps us.

We really do need to get serious about viable alternative fuel sources and distribution systems.  We're funding terrorism and wasting a precious global resource, and the health of our economy is linked to a resource that is going to become increasingly more difficult for us to control.

On a side note, since Congress won't act, we ought to have a national referandum and grant the executive branch a line item veto over entitlements.  I don't care which party is in office - they will both use it to curb waste from the other (and both parties are just as guilty here).

My 2 cents...

[Jeff]

I know what a windfall is, and they can be good things if you get to them before they rot and if they dont damage anything when they come down, many make some fine lumber but can someone explain to me what a profit is?

[Cedarman]

Are we talking cash in the pocket profit or like my profits, paper?(Not the little rectangle pieces with old people's pictures)

Profit,  is it that guy that tells the future?

sc42, looks like I want to sing in your choir too.

[florida]

Oil companies don't set the price of oil, the market does. Just because the world market for oil is good right now is no reason to punish the stockholders of the oil companies. The oil companies made 9 cents on the dollar last quarter, Microsoft made 34 cents. Where is the hue and cry for taxing Microsoft more? What makes the last dollar of profit more valuable than the first?

[wiam]

It is more valuable because it belongs to someone else.

Will

[IL Bull]

NO!
Are they going to tax the sawyers in Louisiana and Mississippi for having low cost logs to mill?

[Striker]

Back before Jimmy Carter was elected President, gas and oil drilling was booming around here. A lot of people around here worked in the industry. President Carter decided that the people in the oil and gas business were making to much money. He and congress hit the oil and gas producers with a windfall profits tax. That killed the oil and gas business around here.

Jeff

[Paschale]

I guess I wish the question was different.  I answered yes, though I've always been a low tax capitalist--I think taxes are too high as it is,  and I usually  tend to roll my eyes when people start talking about raising taxes.  But, in this case, I have a REAL problem with the oil companies.  On the heels of Katrina, and the Gulf War, they got their PR people on the weekend talk shows whining about how hard things are for them, about how their supply chains were irreparably damaged.  This hits the markets, and BAM, the price for crude goes up.  What I find VERY suspect is that when crude was half the cost, they were making half the profit.  Now...crude is twice as expensive, and they make twice the profit.  This tells me that clearly they are passing off far more than simply the higher cost of crude to us the consumers.  Bottom line.  To me...that's gouging.  Do I want to tax them exorbitantly?  No.  But to my thinking, making more profit than ever, while complaining about how Katrina and the War has deleterious effected them seems criminal to me.  I'd like the SEC to open their books and see what's really going on.  That's what I want.

[Bill]

There may be more than two sides to this story but I'd add another two cents . . .

Sure oil costs alot - another guy on TV took the price of oil umpteen years ago ( 20, 30 whatever but he was making a point ) and then adjusted it for the cost of living of those years. Guess what - its cheaper today then it was then. Now I'm not trying to let the oil companies off the hook - they make alot of money - thats the way supply and demand works. Few companies ( and few substitutes ) so as long as the demand is high then the price is high.

What I'd like to see is more substitutes ( read ethanol, biodiesel, %^&@# ) and more conservation. Instead I see my neighbors jump into their gas guzzlers at the drop of a hat and then cry the price is too high.

Now rightfully I believe there are many ways to save - has anyone else noticed that their old ( 93 ) car that weighed 3300 lbs got just as good mileage as the new 4000 lb cars. What the car mfg's gained in efficiency they turned back into "features" that weigh more ( of course ) so no increase in mileage.

But this is where we come in. In the short term we bite the bullet and do our best to conserve what we use now - but the next time we buy a car/truck ( or heater, or bulbs, or windows . . . ) we need to vote with our $$$.

back on task here -  should we tax them because they made too much ? Why because they did well ? Why because we bought it ? Why because they now have to find more ? and just who will decide whose making too much next time around ? Maybe Microsoft ( all profits once the program is written as it costs zilch to stamp out them little CD's that cost $100 - $300 ) or maybe loggers ( or farmers or fishermen or your next door neighbor or YOU ) since mother nature really did all the "hard work". 

Sure we can tax the big guy -
Abe Lincoln once said that you can't improve the little guys lot by tearing down the big guy, you need to lift everybody up to do well.

So let them keep their profits and let us conserve and find substitutes ( and may they be careful lest they go the way of the town blacksmith )

[SwampDonkey]

There may be more than two sides to this story but I'd add another two cents . . .

Sure oil costs alot - another guy on TV took the price of oil umpteen years ago ( 20, 30 whatever but he was making a point ) and then adjusted it for the cost of living of those years. Guess what - its cheaper today then it was then.

There was a report recently released concerning average family income in Canada. It shows that annual income has only risen $500 over the last 15 years. In 1992 I was paying $0.42/litre for gas, now it's $0.96/litre. More than double, my wages didn't double.  In fact in high school I did a little research into wages of foresters and the average was $33,000 back in 1984. Not many making much more than that now. :

[Bill]

Ouch - shame on me for quoting a guy on TV - maybe he meant averages  ???  and I can't vouch for his figures nor math - of course I can say with alot of certainty that he makes more than you and I - probably combined .

The only thing I can do is try to change the things I can . . .

[WeeksvilleWoodWorx]

SwampDonkey,

It's funny you mention the declining wages in Canada in a thread about TAXES. Here is a write up about that very subject.

"The promises of yesterday are the taxes of today."

Is the quote I liked the best. Good read.

[oldsaw]

   Due to circumstances beyound my control I've had a "windfall loss" before. I don't recall the government pitching in to help then. I sure wouldn't want them trying to take any "windfall profits" from me. The increase in fuel prices drove down demand, and then prices came back down. I think the market worked. Beside the ROI is not that great for the oil companies anyhow, it's the volume that makes it impressive.
Mark

What ellmoe said....

[Ron Wenrich]

If I'm not mistaken, the oil companies did receive a lot of tax breaks during the last energy bill.  And, they got to drill Gulf oil for no royalty fees.  Does that qualify as a windfall profit or a windfall loss?

[isassi]

I really have no room to complain. I agree with Bill, and when I was in college, in economics, I remeber the graph showing gasoline prices in 1924 compared to 1994. In '24, gasoline was something like .24 cents per gallon, and wages were barely .80 on an average. (think of the $5 a day Ford employess were paid) In '94, the  ratio is compared to $1.70 a gallon and average wages of $13.00 (median). Gasoline is one of the cheapest things we consume, en masse.  I agree that the profits the oil companies post is obscene, but just another part of the fair marcket economy. What about the traders of the oil futures who probably have no idea what a drilling rig or a pumping unit looks like and the record profits they post is not a public record due to no pulic stock holding in their judgement? So back to the first point, I have no room to complain. The community I live in (most of my life) has an economy based on agriculture and oil. Now we all know how profitable farming is. Oil fuels the construction and economic growth here and everytime I cringe at $2.35 diesel, I only have to think about how well I am doing in construction, and how it benifits our schools and community.

[Cedarman]

The only people I would put a windfall profits tax on is lawyers. They are the ones who make obscene profits. Politicians should be in there somewhere also.

[SwampDonkey]

Reminds me of the pension fiasco with the defunct St Anne mill. The retirees are now trying to muster enough cash ($200,000 ??) to pay a lawyer to fight the government for reducing their pensions to redistribute funds among all workers 55 and older, not just the folks who were already in retirement. To me, it just looks like some lawyer is going to get rich off a few pensioners that haven't got a chance, like a snow ball in Haiti. Some folks who worked at the mill for 30 years were going to get nothing until the government restributed funds. Now if the funds aren't there, do they think I'm going to give them my tax dollars to give them a topped up pension? They are already getting Canada and Old Aged pensions besides. Their mill pension is already more than the average retiree is getting to live off.  : My uncle was laid off with about 20 other people 1 year before retirement, so they couldn't get pensions. They worked there for over 20 years, and some including my uncle help set the mill up. He traveled all over the country building mills and no one gave him no stinking pension. >:(

[Tom]

Karl Marx thought that too.  As a matter of fact, his lean on things was that it all belonged to the Government anyway and you were just using it.  See, the Government can dole it out fairly and that way your neighbor won't have more than you will.   That's fair, isn't it?   I hear it a lot lately.   "The rich people have too much".  "Rich people are bad", "big business corrupts", "that fellow has too much money".  "They have more than they need".   Stuff like that.

Now, the Russians must've had it right. the USSR just kept the citizens in a manner that was equally fair for all.  Wonderful wasn't it?   Too bad it didn't work long enough to usurp the entire world.  That is what they wanted.  I don't think I would have liked it.  But then, I'm not too smart when it comes to Political Economics.  We still have a lot of people running the streets here in the USA that believe that "what's mine is mine and what's yours is mine too".   They riot the streets now and again burn up their stores and take stuff from others that is "rightfully theirs anyway".

Some of them even made it to the top of the companies that they think were so bad.  You hear of them taking huge bonuses from dieing companies and moving retirement funds into areas that make them available to folks other than who they were initially destined. Sometimes they can move into a job and gut the profits so that they can run with their take while the company whimpers in the aftermath.  It's only right you know.   Those workers wouldn't be happy if they had all that money anyway.   Yep, charge what the market will bear.  Put the screws to your buddy before he figures out that he can get ahead by putting the screws to you.  It's only ethics.  What in the Hell has that got to do with anything. 

Social Economics.  I wonder why we don't understand more about it?   I remember a story told by Brother Dave Gardner about a fellow at a work site, leaning on his shovel saying, "one of these days, I'm going to own this constructioncompany".  There was another fellow down in the hole with a shovel and he was digging to beat the band.  Twenty years later, the fellow in the hole owned the company and the fellow leaning on his was still right there saying, "one of these days I'm going to own this construction company".   It's amazing how unfair companies can be.  They actually allowed the fellow in the hole to surpass the fellow on the shovel.  What would Karl have thought?   Well, Karl might have understood a little better than Nikita.  Nikita didn't have a clue.  He was too busy trying to make  life fair for everybody.

Brother Dave figured  "don't tax the rich.  ya ought to tax the little man....  give him something to strive for.....   let'em get on out there and do something.".  Yes sir, tax'em. Teddy K. understands that.  That's what makes him such a wise and fair fellow.   See, He'd spread all of his wealth to the needy and eat cornbread if he just didn't need all the money so that he could fight poverty and look out for the little man.  Course he would have to drive a Chevy and wear combat boots, so.....  well...    I guess that wasn't a good idea after all.  The poor fellow would starve to death.

Yes sir.  Taxes!   They are wonderful things.  They are about the only thing we have for redistributing the wealth.  Taking one fellow's hard earned dollars and giving them to some sorry sack of worthlessness on the street corner.  Is there such a thing as a fair tax?  Yes, I think so.  We don't like them, but we need to keep water running and roads paved and armies fed.  Somebody has to pay for it and a share of the country to one man should be a share to the other.    The problem with Taxes is when we start trying it identify the worth of the earnings of another man.  It's those "others" that always make too much.  I don't think I've ever had a day in my life when I thought I had too much money.

[beenthere]

Tom, well said.

Now, I haven't started working on my taxes yet, but you must have started working on yours this morning. 

[Cedarman]

How many of us hate forced taxes?  How many of us  had visions of sugarplums dancing in our heads as we voluntarily  donated to the government when we bought powerball tickets?

[SwampDonkey]

When I used to work at the marketing board, Revenue Canada used to send notices to us to collect on income taxes for a particular logger. I never thought it was our role or business to collect revenue taxes for government. That's between government and the guy who owes the income tax. It's not the same as collecting goods and services or provincial sales tax in my mind. The government used intimidation and said it was the law. What about our staff that has to deal with the irate logger because we had to withhold that tax? We never got a cent from government to administer that function.  >:(