Residual Forces

Democrats, yes you Sen. Klobuchar (Emily’s List MN) better be careful when trying to lambast the Oil Companies for gouging consumers. You (yes, the Government) is far worse at gouging the consumers of oil and gas than the Oil Execs. 

 

Yesterday, members of the House Select Committee on Energy Independence and Global Warming spent the day beating up on oil industry executives for “excessive” profits and gouging consumers at the gas pump. Lost in the political theater is the fact that those “excessive” profits are net profits: that is, profits earned after taxes are paid to government. And while the oil companies have enjoyed a few good years, history shows that government has profited more from the domestic oil industry than has its shareholders.

Recent data from the Energy Information Administration shows that since 1981—the first year of the Windfall Profits Tax—total taxes from all oil industry sources exceeded the combined profits of all companies in every year but the past three. Between 1981 and 2006, government collected $1.65 trillion in total taxes after adjusting for inflation. That is 65 percent more than the combined earnings of the 16 largest domestic oil companies during the same period.

As the chart below shows, during most of that 25 year period, government tax collections were nearly twice industry profits in any given year. Indeed, in 2002, before the recent price spikes, the industry earned a collective $20.5 billion in profits. However, government collected more than $50 billion in combined income, property, severance, and excise taxes in the same year.

So, the lesson to members of the House committee is be careful of throwing stones when you live in a glass house.

(There’s even a graph if those words don’t do it for you; click on the link above to see it and the data)

 

Oh yes, add up the gas taxes plus all the other hand in the cookie jar fees and taxes oil companies pay, and the Government is still a bigger beneficiary at the consumption of oil than those darn executives. 

Add to that this savant like quote from Pat Shortridge (via King at TN)

Gas is $3.50 a gallon and politicians are ready to lock up oil company executives. Milk is $3.50 a gallon and the same politicians can’t shovel our money to the farm lobby fast enough. What statesmen.

Oh Pat, Klobuchar is completely clueless on this one. 

Stop price gouging by oil companies. American consumers should not have to dig ever deeper into their pockets while the big oil companies amass record profits. We must eliminate oil company handouts and tax loopholes, and dedicate more funds to biofuels research and other homegrown energy sources. (Source Klobuchar Official May 5, 2008)

The taxes the Government has collected from oil companies paid for that microphone Senator. How about the Government lead by example and stop skimming off the top?