The fallacy of Exxon Profits and the "Windfall Tax"

The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Richard S. On: Wed Jun 25, 2008 3:11 am

The Democratic parties main platform has always been lets appeal to the masses demonizing big business and promising to tax the hell out of rich people and give it to poor people, e.g they want to play Robin Hood. Sounds great on the surface and certainly works right up until the point business's stop making money and there's nothing left to take. The simple fact is when Exxon-Mobil , Microsoft and any other number of large corporations, big business and small are not making money neither is anyone else. The suggestion by Obama is lets tax the obscene profits made by Exxon. As I'm about to point out with facts and figures you'll clearly see that its not Exxon gouging the american public but people like Obama who's solution to every problem is to tax it instead of actually fixing it.

Exxon's obscene profits should be stated as the governments obscene profits:

Exxon Mobil Corp. Income Statement

For 2007 Exxon-Mobil reported the following figures*:

Total Revenue: $404 Billion

    After deductions for cost of goods and expenses:
  • Income Before Tax: $70 Billion
  • Income Tax Expense: $30 Billion


Net Income: $40 Billion

Firstly Exxon Mobil is the largest corporation in the world by revenue so profits will be astronomical by any margin. Exxon netted approx. 10% on their total revenue which is low by any standards, Microsoft for example netted approx 30%. To put a face on the amount that Exxon corporation and its shareholders are making as best I can gather it's about 10 cents on a gallon. If anyone can find anything else suggesting otherwise I'd love to see it because I can't find a definitive source. That number was gathered from a variety sources that ranged anywhere from 4 cents to 15 cents. Note that this is not in reference to the price made by the dealer at the pump but Exxon's profit.

You could argue that if Exxon is making 10% profit on every dollar then they are making 40 cents on every gallon but not so fast. You also have dealer profits, taxes directly paid by the consumer and other costs that are neither expense or profit for Exxon that be included in the $4 cost of gallon of gas. I do wish there was really good source for exactly how much Exxon the corporation is making on gallon but there isn't so I'll stick with 10 cents for the time being unless proved otherwise. If you want to go with 20 cents or even 40 cents feel free as its still not that much.

The tax directly paid by consumers at the pump on that gas far exceeds the 10 cents made by Exxon, for that matter its even more if Exxon was making a full 10% on $4. Here in Pennsylvania ithe tax on gas is roughly 50 cents on a gallon. It varies by state but most are going to be in that range. That's 5 times the amount of profit that Exxon is making on gallon of gas, what is even more obscene the percentage that the government was making when gas was cheap.

It doesn't stop there though the consumer is also indirectly paying the 29 Billion in income tax paid by Exxon. Now I'll have to ask who is gouging the U.S. consumer? Exxon or the government? The answer is quite clear, the government is.

The 29 billion in income tax is more tax than the bottom 50% of people in the U.S. paid combined. You heard that correct, Exxon is paying more in taxes than half the U.S. population however in reality it's the U.S. population paying it as these taxes are indirectly being paid by the U.S. consumer. Exxon is just the middleman collecting the money and sending it off to the buffoons in Washington.

Who are the people that reaping these profits? If you're invested in any mutual funds chances are you are invested in Exxon Mobil. Pension funds are some the largest holders of Exxon stock. Many of the people reaping the benefits of the profits of Exxon are in fact the common people.

"Windfall Tax" on top of the other taxes already piled on the American consumer? pffffffffttt... give me a break.

*numbers have been rounded
Richard S.
 
Stoker Coal Boiler: Van Wert VA1200
Coal Size/Type: Buckwheat/Anthracite

Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Devil505 On: Wed Jun 25, 2008 7:20 am

Now you knew I was going to respond to this post, didn't you Richard? :D

At the risk of Greg accusing me of taking an extra dose of conspiracy pills I will just point out that all your info & figures are taken from Exxon-Mobil's reported income to the IRS. These figures are in no way verified but are merely what the company chooses to tell the IRS, at this point in time. They know full well that they have their guy (GW Bush) in the White House & that his Justice Dept is way to busy going after Democrats & politicizing itself & the FBI to go after any "real" criminal activity.

Justice Dept. hiring marred by politics: probe By Randall Mikkelsen
Tue Jun 24, 11:58 AM ET

WASHINGTON (Reuters) - U.S. President George W. Bush's Justice Department improperly injected politics into hiring programs, a department investigation released on Tuesday found.



Full story:
http://news.yahoo.com/s/nm/20080624/pl_nm/usa_justice_probe_dc;_ylt=AqeYm5MazUGnyy0KUA30FNMa.3QA
Devil505
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: billw On: Wed Jun 25, 2008 7:37 am

I don't have a problem with companies making money, we're not communists. I have a real problem with Exxon still not paying for the cleanup of the Valdez oil spill. They took the risk, made the profits but the taxpayer gets stuck paying the bill for a mess caused by an Exxon action. If it was any of us we would have been forced to pay a long time ago. The big companies like privatizing profits and socializing their expenses.
billw
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Devil505 On: Wed Jun 25, 2008 7:54 am

billw wrote:The big companies like privatizing profits and socializing their expenses.



Exactly!
Devil505
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: billw On: Wed Jun 25, 2008 12:22 pm

Ok, have to take my rant back. Exxon paid 3.4 billion for the cleanup. What they still owe is punitive damages which was just settled by the Supreme Court. Dam, crow tastes like *censored*. :oops:
billw
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Rob R. On: Wed Jun 25, 2008 1:19 pm

The punititve damages decision was issued today. Not bad, only took them 19 years to reach an agreement... Exxon probably spent more on the lawyers than they did on the cleanup.

Random fact: According to Wikipedia, the Valdez tanker was repaired in 1990 and is still sailing under the name S/R Mediterranean.
Rob R.
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Richard S. On: Wed Jun 25, 2008 2:56 pm

Devil5052 wrote: These figures are in no way verified but are merely what the company chooses to tell the IRS, at this point in time.


Proof? Anything that would remotely suggest that is a fact? or just another attempt to steer a topic off course when presented with the truth?
Richard S.
 
Stoker Coal Boiler: Van Wert VA1200
Coal Size/Type: Buckwheat/Anthracite

Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Rob R. On: Wed Jun 25, 2008 3:30 pm

Devil5052 wrote:At the risk of Greg accusing me of taking an extra dose of conspiracy pills I will just point out that all your info & figures are taken from Exxon-Mobil's reported income to the IRS. These figures are in no way verified but are merely what the company chooses to tell the IRS, at this point in time.


If you think they are cooking the books now, wait till Obama tries to raise their taxes. The more the government tries to tax and regulate big business, the more lawyers and accountants the businesses hire to avoid paying the taxes. This boils down to old supply-side economics arguement; keep the tax burden on big business manageable, and they will actually pay the taxes rather than spend money to avoid them.
Rob R.
 
Stoker Coal Boiler: EFM DF520
Hand Fed Coal Stove: Hitzer 50-93
Coal Size/Type: Lehigh Rice
Other Heating: Dad's 1953 EFM Highboy

Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Devil505 On: Wed Jun 25, 2008 3:43 pm

Richard S. wrote:
Devil5052 wrote: These figures are in no way verified but are merely what the company chooses to tell the IRS, at this point in time.


Proof? Anything that would remotely suggest that is a fact? or just another attempt to steer a topic off course when presented with the truth?



A little common sense Richard.......... & a lifetime of understanding how the criminal mind works & what chances they are willing to take when the payoff is huge & "their boy" owns the police dept. :D
(damn.....where did I put those conspiracy pills??)

Edit: I think some of the "Proof" you are looking for will come out when Cheney's Energy Task Force records are finaly made public. (These records involve meetings between all of the major oil company CEO's & this administration back in January of 2001 & have been kept secret despite repeated Congressional court attempts to see what was said/decided)
Last edited by Devil505 on Wed Jun 25, 2008 4:20 pm, edited 4 times in total.
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Devil505 On: Wed Jun 25, 2008 3:46 pm

markviii wrote:If you think they are cooking the books now, wait till Obama tries to raise their taxes. The more the government tries to tax and regulate big business, the more lawyers and accountants the businesses hire to avoid paying the taxes. This boils down to old supply-side economics arguement; keep the tax burden on big business manageable, and they will actually pay the taxes rather than spend money to avoid them.



Sorry Mark but I'm tired of just handing over my lunch money to the bully for fear that he'll make things worse. :mad:

(It's just amazing what a real criminal prosecution does in terms of getting the attention of some of these CEO's & corporate accountants. I predict we'll all see just that when we take back our Justice Dept. next year)
Last edited by Devil505 on Wed Jun 25, 2008 4:21 pm, edited 1 time in total.
Devil505
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Devil505 On: Wed Jun 25, 2008 3:55 pm

Just in:


More offshore drilling does little at the pump: EIA By Tom Doggett
2 hours, 24 minutes ago



WASHINGTON (Reuters) - Allowing oil drilling in U.S. offshore waters that are now closed to energy exploration would do little to lower gasoline prices paid by consumers, the government's top energy forecaster said on Wednesday. (my emphasis)



Full story:
http://news.yahoo.com/s/nm/20080625/ts_nm/usa_oil_offshore_dc_1
Devil505
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: spc On: Wed Jun 25, 2008 4:18 pm

the government's top energy forecaster

Definition: To calculate or estimate something in advance; predict the future. :o
spc
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Devil505 On: Wed Jun 25, 2008 4:24 pm

spc wrote:Definition: To calculate or estimate something in advance; predict the future. :o



Thanks for the clarification spc.
(I did a little "predicting the future" in my earlier post about taking back our Justice Dept. too) :)
Devil505
 
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Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Richard S. On: Wed Jun 25, 2008 5:12 pm

So that's about 2 maybe 3 posts in row completely off the topic Devil? To put it bluntly you got nothing, you've been ranting and raving about the "obscene" profits Exxon has made yet the only thing you have posted in this topic is pure speculation and conjecture. Here's your chance to provide some information based on facts as opposed to opinion so lets hear it.

According to the figures posted Exxon's take on gas is paltry compared to that of the Government yet Obama is advocating that they tax it more, this cost is inevitably passed onto the consumer. Exxon is not going to absorb those costs, the consumer will. No business is going to do that whether its the Mom & Pop store on the corner or the largest corporation in the world, expense always gets passed onto you the consumer.
Richard S.
 
Stoker Coal Boiler: Van Wert VA1200
Coal Size/Type: Buckwheat/Anthracite

Re: The fallacy of Exxon Profits and the "Windfall Tax"

PostBy: Devil505 On: Wed Jun 25, 2008 6:06 pm

Richard S. wrote:o that's about 2 maybe 3 posts in row completely off the topic Devil? To put it bluntly you got nothing, you've been ranting and raving about the "obscene" profits Exxon has made yet the only thing you have posted in this topic is pure speculation and conjecture. Here's your chance to provide some information based on facts as opposed to opinion so lets hear it.



OK Richard....Here are a few facts for you:

1. Your statement: ''''"that's about 2 maybe 3 posts in row completely off the topic Devil?" is simply your opinion. My opinion is that my posts have all been "on topic."
2. The Exxon-Mobil financial figures you are using are "in fact" based on what they choose to Report to the IRS. Unless there is a full field audit, the IRS & you are merely taking their word for what they are reporting....& I don't trust them as far as I could throw them!
3. I have never expressed anything that I don't freely admit are just my opinions. Indeed, no one without access to oil company books (or secret government documents) is in any position to provide sworn testimony. All we can do, as private citizens is accumulate publicly available information & make informed speculations as best as we can.
4. I do use the word "obscene" to characterize the profits that the major oil company's are raking in. I do this because
they are American Corporations doing grave damage to their country in time of war.
Devil505
 
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