A Little Big Oil Perspective

[bolverk]

Aug 14, 2008 20:47:28 GMT -5 saunterelle said:

windfall profit -- an unexpected profit arising from causes not controlled by the recipient.

Hence, when Bush cut taxes for the oil companies in 2005 it created windfall net profits. Obama's plan is to reinstate the tax and use the proceeds for alternative energy R & D to break our dependence on oil. It's like how we use tobacco taxes to fund anti-smoking campaigns. The oil companies were doing just fine before the 2005 tax cut, right?

So, 7% profit is your definition of windfall?

[subdjoe]

One thing puzzles me. The socialists like Saunterelle think it is reasonalbe to say "Stop using oil now! We must use ONLY alternative sources, many of which are still being researched, and are not ready to be used in our economy." and think this is reasonable.

They think that it is unreasonable to say: "Work hard on developing all the alternatives, and looking for others, in the mean time so our economy does not colapse, we need to also tap our oil fields and develope them too." Something is wrong with that.

[saunterelle]

How about improving public transit (many of which already run on natural gas) so that people have a choice? The way our country is set up keeps us dependent on the automobile for transportation.

[subdjoe]

OK, sounds reasonable. Make sure that no one has to walk more than a few blocks, there is plenty of room for bags and packages, and the waiting time for a bus is not more than about 15 min. That is what it would take to get people to really convert to using public transit. So we would need to about quadruple the number of busses we have in our fleets. Oh, and they would need to run that schedule 24 hours a day.

I do agree, the bus system here is a joke. I tried taking the bus to and from work for a while. What was a 15 to 20 minute commute turned into about an hour and a quarter test of patience. What was really screwed about it is that the busses only have racks for two bicycles. I would cycle to the bus stop, and sometimes have to take the 4th or 5th bus to come by so there was a spot for my bike.

[bolverk]

saunterelle, our public transit is a joke, it always will be a joke and it will never accomplish what you claim it can, for several reasons.

One, it limits movement. Even if you added more buses, they would never drop the majority off in a place they really need to be. You would still end up walking and limiting what you could do, because of the restrictions imposed by a public transportation system. Individual transportation equates to freedom, public transportation never can.

Two, all public transportation is subsidized, and would die out if there were no subsidies. This will always be the case, because the price of riding public transportation is kept artificially low. Just look at the Golden Gate Transit as an example. The Golden Gate Bridge costs five dollars to cross, why? Because of the losses incurred by Golden Gate Transit.

Three, we are not dependent on the automobile, it is part of our culture. That is where you reasoning leaves the realm of reality. It would be impossible for public transportation to fill the needs of freedom. Can you imagine a bus taking you all the way to your favorite fishing spot on Lake Sonoma, as well as carrying your boat for you? No, you can't, and it will never happen.

Can you imagine a bus whisking you across town for lunch at your favorite restaurant and getting you back to work on time? No, it will never happen, and it is impossible for it to happen. Only transportation geared to individual needs and freedom can do that.

The only way public transportation will ever succeed is if it is geared toward individual needs. Since no one can fathom this idea as of yet, all forms of public transportation will remain as they are, subsidized and ineffective. If it could be any other way, someone would invest in the idea, rather then asking the government to take peoples money and pour it down a bottomless hole.

[bolverk]

And by the way, what about that 7% profit being considered windfall? Should we apply such standards to all businesses? If you make 7% profit, we will raise your tax rates. Regardless. Sounds like a damper on free enterprise to me.

[jgaffney]

Aug 14, 2008 19:05:33 GMT -5 saunterelle said:

What percentage of their profits is invested in alternative energies?

The windfall tax would simply be reinstating the tax that Bush cut in 2005. The oil companies seemed to operate just fine before their taxes were cut. What was the reason for that tax cut again?

Boy, I tell ya - the Internet is a beautiful thing! With it, you can learn what really happened waaay back in 2005. This is from the WashPost in 2005:

For the oil and gas industry, the legislation allows some costs associated with exploration to be deducted over a shorter time period and provides tax benefits when oil and gas production is delayed and a lease is extended. It reduces the depreciation period for natural gas distribution and gathering lines as well as the depreciation period for electricity transmission and pollution-reducing facilities added to some coal-fired power plants.

The measure also includes some tax credits for solar energy equipment, fuel cells and energy efficiency improvements to existing homes.

Remember, the best way for the government to get a private company to do something is to pass targeted tax breaks to encourage the action. So, the actions that were encouraged by these targeted tax breaks included more oil and gas exploration, more natural gas and electricity distribution, pollution reduction at power plants and energy retrofits for homes. Please tell us, Saunterelle, which one of these targeted actions was a bad thing.

Another liberal myth dispelled.

[saunterelle]

Fair article, but the points you highlighted do not tell the whole story. I suggest everyone read the whole thing to get a better understanding.

[jgaffney]

Saunterelle, I pulled those two paragraphs from the article because I thought that they were the most succint summary of the measure that the author presented. I ignored the second paragraph of the article because that was obviously added by the WashPost editor to make sure that the liberals - oops, I mean "progressives" - would be able to interpret it correctly.

Further down in the article, a part you might have not gotten to, describes the tax breaks as "$8 billion over a ten year period." In case you are numerically challenged, that works out to $800 million per year, divvied up among the six categories listed above. Is that what you are referring to with your "windfall profits" comments?

BTW, how are you coming on that CNG Honda Civic I pointed you to? In order to reduce your dependence on petroleum, are you ready to spend $25k on a new car?

You may also be interested to know that natural gas is also a petroleum product. It's usually found in the same seams as the oil. So, being opposed to new oil exploration also makes you opposed to new natural gas supplies, right?