Because F-150s and Windows Vista are fundamentally luxuries, not necessities?
Heck, you could even make an argument that since oil is a strategic resource for the operation of the nation’s Iraq war, excessive gouging could be a form of war profiteering. Then again, perhaps Bush simply sees that as a proud family tradition…
You know why that safety net is there, right? It’s because the oil companies are exploring for resources that you benefit from, and you pay the same price whether they hit the mother lode or just dig a big hole. It costs a lot to explore and exploit oil resources. I don’t think the subsidies are unreasonable at all. If they went away it would be a severe disincentive for oil companies, and even more expensive for you at the pump.
If it were you, would you stake your company’s financial future on what may end up being a dry hole? Of course not. Yet that’s what oil companies have to do every single day for your benefit. A little government largesse is perfectly fine with me.
“excessive gouging”? What, pray tell, is that? Is that your euphemism for “they gouge us anyway, but now it’s excessive”? Is there any price the oil compaies can charge that you would not consider gouging? Hell, even at cost it would be more than $1.50 a gallon, just for the crude.
I’m trying to find the cite that has XOM with an 18% net margin. My calculations come to 10.06% after-tax margin. Chevron has a 7.4% after tax margin, Conoco has a 7.01% after-tax margin.
Those are all current margins, not historical.
Well, if don’t have an F-150, what do you need gas for? 
Is there something about a “necessity” that makes it wrong to profit from it? Like I said… if there is any illegal anti-competative practices going on, let’s prosecute it. But making a profit is not illegal.
I’ll just echo what Doors said. Please define “gouging”, and then define “excessive gouging”.
Wow, Doors, I never realized you turned socialist. Intel starts a major design project, that might very well go bust and get cancelled without realizing any revenue. They don’t ask for a handout from Uncle Sap. Lots of companies make big bets all the time. It’s called business, and you aren’t guaranteed to win.
If the oil companies want a cushioned downside, they shouldn’t complain about paying back through an excess profits tax for the upside.
In any case, these excess profits aren’t from anything the oil companies did. If they exploit a new oilfield, and make a bundle, more power to them. Here they were the beneficiaries of the market.
Yeah, I get that a lot anymore.
Intel also has the benefit of technological advances and known quantities to build on. A new chip is an advancement, not an innovation. Contrast that with the oil companies who, while having experienced people able to make good guesses at where to look, are still rolling the dice every time they drill a test well.
They aren’t excess profits. NPR, that bastion of conservative thinking (hah!) said the other say that they have re-invested about $5 billion of that into exploration, exploitation, maintenance, and refinery capacity. Of course, it’s for their benefit, but it’s also for your benefit, because they can only make money if they have a product to sell.
I’m glad to see that we agree.
Where’d you get that idea?
The Disco Ball Of Failed Hopes And Other Tales From Inside Intel
Of course, Apple, Apple’s got the inside track:
I think that’s about right. The numbers I’ve heard range from 6% to 12%, depending on the company. And that’s in the good times. The raw numbers look large, but these are really big companies, so it’s easy to blow a gasket if you don’t look at %. Of course the oil companies don’t do themselves any PR favors by giving $400M compensation packages to CEOs. Talk about stooooopid!
Never been involved in a chip design project, have you? You put 500 or more highly paid people on a project lasting for four to five years, hoping that you do everything right and that the market doesn’t turn south on you, and that your competitors don’t get a better idea, making your chip slow and obsolete the moment it comes out. Yeah, a speed bump ain’t much of a gamble, but Itanic, which I worked on 10 years ago and is still not a success, cost Intel billions of bucks. Drilling a well is like shooting ducks in a barrel in comparison. Sure, you come up dry, but you can afford to drill a bunch of them - not just one or two.
Lots of companies bet their futures every year without the benefits of government largesse.
Is that profit, or money from uncle? What a concept - putting money back into the business! Ever wonder why most Silicon Valley companies don’t pay dividends? It’s because they put the money back into new research and development. Nothing new there.
Not to completely hijack this, but seems a bit relevant.
Take what you stated, add a thousand more people, double the time frame, and you get the pharmaceutical industry.
Well, lets look at just how “ridiculous” my statement was, shall we? First of all, the 18% figure I quoted was what I remember hearing on a news report, and it was just for the past quarter. Wanting more details, I looked at the MSN Money page to get an idea of how far off base my claims were, after all, I’m one of those crazy people who think that business have a right to profit and crazy shit like that, I’m liable to say anything! Now, where to find a representative sample of “good” businesses? Hmm, if only there were some type of index of historically well performing companies…Hey! The Dow Jones! Listed below are the companies that make up the Dow. (I think SBC Communications is in there too, but for some reason I couldn’t find them using the above tool, their might have been a merger or something that I missed, so they are omitted) Quarterly net profits were not listed on that website, but average for the past 5 years and for the past year were listed, so those are the numbers that follow each company name respectively. The first column is the stock symbol:
MMM 3M Corporation 13.1 15.4
AA Alcoa 4.2 5.8
AIG American Int’l Group 9.9 9.6
MO Altria (was Philip Morris) 14.8 14.7
AXP American Express 11.3 13.6
BA Boeing 3.8 4.9
CAT Caterpillar 5.8 7.9
C CitiGroup 16.9 19.7
KO Coca Cola 20.8 21.5
DD E.I. DuPont de Nemours 8.5 7.2
XOM Exxon Mobil 9.3 10.9
GE General Electric 11.3 11.4
GM General Motors -.02 -4.5
HPQ Hewlett-Packard 2.4 3.1
HD Home Depot 6.6 7.2
HON Honeywell 3.3 6.2
INTC Intel 16.8 20.4
IBM International Business Machines 8.0 9.3
JPM JP Morgan Chase 8.4 11.0
JNJ Johnson & Johnson 18.4 21.3
MCD McDonalds 10.4 12.0
MRK Merck 19.0 21.7
MSFT Microsoft 28.3 31.6
PFE Pfizer19.1 23.4
PG Procter and Gamble 11.3 12.6
SBC SBC Communications N/A N/A
UTX United Technologies 15.55 18.00
VZ Verizon Communications 6.6 9.8
WMT Wal-Mart Stores3.4 3.6
DIS Walt Disney 5.4 8.4
This averages out to a 5 year net profit of 10.78%, and a one year net profit of 12.34%. Exxon/Mobil’s numbers (bolded above) are 9.3 and 10.9 respectively. Gee, they look positively…average. (FYI, the oil and gas industry average is listed as well, those numbers are 7.7 and 9.1) Even if you expand the pool by using the percentages for the S&P 500 (6.2 and 8.3), Exxon/Mobil’s net profit margin is still pretty dam average.
Looks like I’ve proved my point, wouldn’t you say bup?
You know, I realize that religious tests for holding public office are explicitly forbidden in the US constitution, but would there be any bar to requiring legislators to pass Econ 101 as a prerequisite to holding public office?
Most of the socialists that I know consider themselves to be very fortunate in life. Many have done well themselves. It is not wealth that they abhor. It is poverty. It is beneath you to be so mean-spirited by mischaracterization.
I don’t know of anyone here who has expressed an objection to oil company profits. We object to what may be unfair practices to obtain record profits at a time when gas prices are soaring. We object to an administration that has not provided leadership to promote conservation of resources. Many of us object to corporate welfare for companies that profit by the billions. Let them grow the old-fasioned way. They can reinvest some of their own money. We object to secret Energy Summits between Big Oil and our public servant, the Vice President and former CEO of Halliburton Oil.
Meanwhile, let’s raise the minimum wage for the first time in almost a decade. (I am retired, lest you think I am being too petty and jealous.) Or do we need more “guest workers”?
You’re talking about free trade. True free trade would be bordering on heresy, if you really look at it. Since when has Exxon/Esso/Standard Oil ever been interested in free trade? They have no risk. It’s guaranteed profit. All that talk about the empty wells and dry holes really broke my heart too, as it obviously did yours (uh huh). And yes John Mace, that 400 million retirement deal was a bone head move, especially right now.
By the way, I should disclose* that I am a Oil Profiteer - I own 1,000 shares of ExxonMobil. At current dividend rates, I should pull in about $1,300 pre-tax, yearly, for the rest of the company’s life.
This money gets reinvested back into my retirement fund (I have enough XOM for now, and it’s pretty high as it is), where it makes even more money.
This is what we are told to do, this is what people decry “Americans” for not doing - saving. Investing. Making rational, long-term decisions about our money and how to use it to maximize its benefit for our family. But then the very same people do this, actions that make it increasingly impossible to save.
This stupid, idiotic tax, a tax on nothing more than the pure fact that XOM is in a commodity businesses, and that commodity businesses have boom/bust business models that require lean operations that become “wildly” profitable during boom times, is a tax against MY retirement, a tax that increases the uncertainty of whether I will be able to afford medicine for my wife, the vacations we always wanted.
Let’s look at the numbers. I’m 39. I’ll retire at, say, 69 - that gives me thirty years. At $1,300/yr, that comes to $39,600 in dividends… invested at 7%, by the time I retire that is $82,566** extra that I will be able to retire on.
So let’s assume this tax reduces my yearly dividend by 20%, down to a more “reasonable” $1,040. I lose $8,400 in dividend savings (to $31,200). I lose $9,114 in investment earnings off that $8,400, to a tune of $17,514.
Just to make you*** feel good. You want to steal, literally, $17,514 out of my wifes pocket because ya can’t read a freakin’ income statement or bother to Google US oil data, XOM’s SEC filings, or whatever. It’s easier to whine and steal than to accept and pay the price of living in a well-functioning world, you’d rather steal the equivalent of a four years’ college tuition at some State school*** from my little girl* than drive less?
Fuck you. Fuck you Chuck Schumer. Fuck you, you ignorant anti-corporate pseudo-activist, thinking you’re so cool for wanting to stick it to “the man”, showing your ‘independence’ by driving a Honda to your deadend job at the alternative record store. Fuck you, SUV driving hypocrite who winces every time they fork out $40 for a tank of gas - people told you this was coming, why did you not believe them? Fuck you, retarded soccer mom who complains “the government oughtta do something!” - you do something, bitch! Fuck you, worker in an industry that is sensitive to gas prices - your company’s loss of operating margin is no reason to steal from my child, dipshit!
Sorry. But nobody, nobody speaks up for the investor, the people who are doing as they have been taught and actively saving for their retirement (as opposed to throwing 4% of your income into some bland mutual fund mix in the company 401(k)). All I hear is “Exxon whine” this, and “Oil prices whine” that, and fuck it - it’s my turn.
You want oil prices to fall: stop using so much. It’s that goddamned simple. If you want to use it, pay for it. You want Exxon to lose profits - don’t shop at Exxon. And stop crying like a baby and for God’s sake, stop trying to STEAL MY RETIREMENT!
*Not really, but what the hell. Might as well talk about whether oil is a decent investment.
**I’m not considering taxes - what the hell, this is an internet post, not a financial analysis! 
***The rhetorical “you”, of course. 
**** Offer not valid in Pennsylvania. Damn, but do you people pay out the wazoo to attend your own state schools!
Very true. Or a new airliner.
Very true. But keep in mind nobody is blaming Boeing or Airbus for anything. Certainly not in anything that they can make political points from.
Different industries, different markets, different demand, same thing. All are making profits.
(Following not directed to quoted Doper)
It’s funny how the left on these boards gripe about gas prices, then cackle in glee about how Congress will shift to the Dems because of the gas prices. It’s not a concern of gas prices, it’s a concern about gaining power. The DNC doesn’t give a shit about gas prices. It’s about getting the votes in November.
And the GOP is falling into this trap as well.
And all the Bush voters we’ve been told are ignorant and retarded are the same ones the DNC is gunning for on gas prices trying to get that vote. And it’s working.
Doesn’t make the GOP right, but shows the Dems aren’t any better.
You just made the exact same point Rush Limbaugh did a couple of days ago. He said the Democrats should be thrilled about rising gas prices because it’s “what they’ve always wanted.”
As a note, I don’t drive an SUV, and it would cost around $60 to fill my tank. When you’re NOT a suburban soccer-mom with way too much time and money on her hands, $60 is a chunk. Now imagine someone with a minimum wage job (better than them getting welfare, right?) trying to keep their tank full. They have to work for a good 10-15 hours just to tank up.
I’m not saying that there aren’t a lot of whining bitches out there. I’m just saying that you may forget, in your stocks and bonds and financial planning and daughter going to college, that there are people out there for whom a big gas bill doesn’t mean cutting out a vacation or quitting smoking or no longer going out to eat; it can be a gallon of milk (slightly MORE expensive than gas right now, actually), three loaves of bread…
Just sayin’. Not everyone is able to brush off high gas prices by bitching about stock options and four-year colleges.
I don’t care about driving less, but I’d merrily take that right out of her sweet little feminine hands - via your stocks tanking - if it meant that 1000 families could afford that extra gallon of milk.
It’ll never happen. But, you know, fuck YOU for only thinking about gas prices in terms of YOUR benefits, or of the slight detriment to people who can fucking AFFORD SUVs in the first place.
BTW, don’t bother labeling me as socialist or whatnot - I don’t have a particular political philosophy.