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People upset about profits in the oil companies rarely are educated in the means of economics. Any time a tax is added, whether it be a sales tax, an excise tax, a Social Security tax, a car tax, a capital gains tax, or "a windfall profits tax", it raises, albeit artificially, the price of existing items - in this case oil and petroleum products.

It doesn't surprise me, but it does alarm me, that when big news is made of "Exxon-Mobil makes $9 billion profit in the 2nd quarter," people are all outraged at the amount of money people say the "big oil" companies make.

People have been trained through "environmental awareness" to think of big oil in the same way that seven to ten years ago the same people felt about "big tobacco," specifically R.J. Reynolds and Philip Morris; that they cheat and steal and lie and do every man, woman, and child on the planet harm by selling their product. Does your car need gasoline or some other fuel? Well, what the people who report the earnings in this such way, "Record profits of $9 billion," aren't telling you is that there are more revenue streams, especially with publicly traded companies, than just selling the product they sell, like stock and bonds and other financial instruments.

What people failed to read into the $9 billion "profit" as one newspaper put it, is that the earnings per gallon of gasoline, (and albeit net crude oil), is nine cents. Less than ONE DIME per! And yet, we're taught not to blink twice when the government's take at the federal level is twice that at 18.4 cents, and in the Soviet Republic of New York, all by its itty bitty self, takes 43.9 cents plus 4% per dollar sales tax (at $3/gallon) about 55.9 cents all totaled. PER GALLON. So if those 9 billion that the oil company earned were entirely in gasoline, .09 per gallon to $9 billion, is 100 billion gallons.
So, one hundred billion gallons of gasoline, times 18.4, (the federal excise tax on gasoline), equals 18.4 billion dollars, more than twice what the oil company has made. Take that into account with New York State and the federal government, (because there are federal roads in New York State), and the number climbs to 74.3 billion for the governments.

And now there's the suggestion that the government should get MORE?!?!?

How about, people start drilling for oil again in this country, so the Saudis and Venezuelan dictator Hugo Chavez not get as wealthy off of the oil prevalent in their lands?

Oh, sure... there's environmental impact... blah blah blah. It's work, people can do it, regardless if they're told that they can't. If we want to put real life-blood back into the economy, we as Americans cannot be dependent upon others to do our work for us, but in saying that, we cannot discount production, be it of our own natural resources, of our own products, or all things American made and used.

Let oil companies do their producing, and let it be government's mandate to find cheaper ways, not hindrances and regulations to the umpteenth degree, to allow the free-flow of free market capitalism within these United States. Oil companies deliver a product, governments sell a bag of tricks... including a windfall profits tax.

No, oil companies should not pay a "windfall profits tax."

Learn more about this author, Kenneth Boser Ii.
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