Need to smack down a RWer on oil company profits

[NewJeffCT]

I was on another board and he was complaining that oil companies really aren't very profitable, making only 9 cents on the dollar, while the feds take 50 cents on the dollar in taxes for oil.

This was my response, but I could use additional ammo:
>>>>
I just found this thread now. A few things... a quick glance at ExxonMobil's financials over the past 5 years indicates that their profit margin has increased quite a bit in the past 5 years. At year-end 2001, their net margin was a little over 7 cents on the dollar. At year-end 2002, their net margin was almost 6 cents on the dollar. For years-ended 2003 and 2004, they made around 9 cents on the dollar, but at year-end 2005, it was a bit over 10 cents on the dollar. So, in 3 years, their profit margin is up nearly 70% (less than 6% to over 10%)

Sure, their profit margin is small when compared to pharmaceutical companies or health insurance companies, but you also have to realize the scale. The net profit of ExxonMobil is greater than the gross revenues of just about every major health insurer out there. Heck, it's greater than almost every corporation in the world's gross revenue, save maybe the top 100.

ExxonMobil paid $23.3 billion in income taxes in 2005 - far less than the $100 billion number I've seen tossed about in this thread. That is an effective tax rate of 6.5%, or quite a bit lower than their profit margin. I wish I could have paid an effective tax rate of 6.5%!!

For the record, they paid less than $16 billion in 2004, which was also a record-breaking year for them, and $11 billion in 2003.

I have no problem with the CEO of ExxonMobil making $400 million...it's certainly a lot better value than when Aetna acquired US Healthcare a decade ago and US Healthcare's CEO got a $1 billion golden parachute for a company that was a lodestone around Aetna for nearly a decade (Being in the Hartford area, I know a lot of people that work at Aetna, so I'm familiar with the story)

The problem with the oil companies is that from their record breaking profits, they are instituting massive buy-backs of their own company stock and are not investing in improving the efficiency of their refineries, or building new ones. By the way, the oil industry has shut down over 30 refineries over the past 30 years... some due to environmental concerns, but mostly due to industry consolidation and to increase their profit margins. (We keep hearing how there is plenty of oil, but the refineries are running at capacity!)
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[FloridaPat]

1. That 9 cents on the dollar comes after all salaries, bonuses, travel,

etc has been taken from that dollar. Unlike the rest of us, corporations take off everything as a business expense.

[Wickerman]

2. Good job

and no, taxes aren't 50 cents on the dollar. Why, on earth, would RWers continue to defend these blood-sucking parasites?

Here is your tax chart, by state:

http://www.gaspricewatch.com/usgastaxes.asp

[NewJeffCT]

7. There are a lot of "plusses" added on there

If you look at the chart, it says "plus x UST tax, plus Y tax, plus..."

[Wickerman]

9. simple math will show you on any state that it is no where near

50 cents on the dollar. Certainly you have states that might net 50c on the gallon, but we havben't seen 1$ a gallon gas in some time.

[NewJeffCT]

10. agreed

Maybe if gas prices were 75 cents a gallon...

[NewJeffCT]

12. The response was

If you include other taxes - property, state, local, excise, etc, you get 50 cents on the dollar. I need to do a bit more research into the total amount of taxes.

[Wickerman]

14. lol

I'd ask them to prove it. I'm certain they can't, and as was stated otherwise, there are off-setting breaks. Even, on a very odd chance it can be shown that oil companies are taxed 50c on the $ I will shed no crocodile tears for them. Somehow, someway, they manage to turn an obscene profit while they rest of use make tough decisions of what to cut out to pay our rising bills.

[NewJeffCT]

15. well, I added it up

They paid a total of $94 billion in taxes in total. So, about 25 cents on the dollar for all their revenues.

[Wickerman]

17. nice work

Oh, how they suffer. As an individual I am at the 26% tax rate, I believe.

[NewJeffCT]

18. a fellow multi-billionaire, I see

and, thanks for the help before.

[kittenwithmittens]

3. Want to hear about a real outrage?

Hydro Quebec, the power generation company owned by the Quebec govt., announced a 2 billion dollar PROFIT over the last year, yet they are raising the electric rates 10%.

[Atman]

4. Corporations should not be considered "citizens"

A People Plank for the Democratic Party

By Timbuk3

I want to share an idea that I think has real promise. It's at the "give me feedback" stage, now, and I'm patient enough to do it right, but here it is right up front: We need to make the Democratic party understand that we expect them to put forth and support a constitutional amendment defining what a "person" is, once and for all. This amendment should define a "person" as a human being regardless of where they were born. I'm not a lawyer, so I'm looking for help in the exact words to use to keep the definition in line with the 14th amendment, too, and I'm open to CONSTRUCTIVE criticism on how to make the whole thing workable. I also realize that I'm making quite a leap stating what "we" demand, but stay with me a little longer.

If done right this could end the domination of politics by corporations, as it would make it the foremost law of the land that only "persons" have civil rights. Corporations (and other special interest groups if we word it carefully), not having been "born", would have no first amendment right to free speech that allows them to spend such huge sums of money to influence politics. (You don't have to be all that astute to see what other things defining a person this way can do to bring peace to the nation, too.)

I'm under no illusion that the Democrats aren't beholden to corporations and big money. Different corporations and different big money, sure, but beholden to THEM and not to US just the same. If we're so sure we're right, that corporate money has ruined politics, why shouldn't we push this? Why shouldn't we DEMAND that the Democratic candidates push this? Why should we support the Democrats if they PROVE to us that corporate money is more important to them than our opinion?

The Daily Kos and DU have raised astounding amounts of money for some candidates. Other Democratic candidates and congress-critters post on these sites and ask for feedback there. There is recognition that the upcoming election is a "base election" and "the angry left" is actively sharing ideas, strength, and money because they expect to be heard. Needless to say, this has the hateful right up in arms! The RW complains about "the angry left" bloggers out of fear because they recognize a real threat to their power!

The Democrats know what's happening, too, and how much power we still have. Just as an example, Lieberbush is in deep shit in CT, and he knows it. He's allied himself with "God's chosen President" one time too many, and the support of people like you and me are giving Lamont a REAL chance to unseat "joementum" in the primary.

We shouldn't allow the DNC to "move right." In the past year or so there's been a real awakening in America to the indisputable fact that the GOP is unable to do ANYTHING without the approval of the RW-extremist fundies (and if they've forgotten remind them about Harriet Myers.) Anyone who believes that it's not the government's province to legislate morality, that it's distinctly un-American for the government to make "value" judgements for them, isn't going to vote for God's Own Party this time around, but they may choose not to vote at all. We will NEVER win the vote of a RW-religious extremist, but anyone else who is tired of the GOP culture of corruption is looking for something to be FOR. I've talked to people from all "sides" in the political debate and this is one issue all Americans (except those who vote on faith) can unite on. If you want to "reach across the aisle" and get former GOP supporters to vote Democratic getting rid of the dirty corporate money is the ticket. People are so overwhelmed by the huge sums of money dumped into politicans pockets that they feel like they no longer have any influence on our nation's politics and laws, and they're tired of it.

We shouldn't support a Democratic party that's ONLY better than the GOP because they're free to act without consulting the Dobson's and Falwell's of the world. We should let the Democrats know what we want them to do for us, and WE SHOULD EXPECT THEM TO DO IT. The religious right and the big money behind our current government aren't going to give up power meekly, but until we get the money and the religion out of politics we aren't really even in the ring, much less winning the fight. The least we can do is tell our representatives HOW to represent us, HAVE THEIR BACKS when the inevitable attacks begin, and be willing to DO THE WORK TO MAKE THE CHANGES necessary to restore government for, of, and by the PEOPLE, not legal concepts.

http://www.timbuk3.com/

[randr]

5. That 50 cents pays for the military support

required to keep the oil flowing.
Just saw that the price of gas in Venezuela is 16 cents/gal.
The nationalization of the oil and gas industry could go a long way to solving some of the problems we are facing and would take back control of a natural resource that belongs to the citizens anyway.

[shenmue]

6. I figured...

that RW's initial claim of the 50% tax smelled like B.S.

[baldguy]

8. They did get 9 cents on the dollar - 20 years ago.

Now, it's more like 30 cents. They cost of production, refining, delivery & taxes hasn't changed over the last five years.

[gratuitous]

11. Gosh, the poor oil companies!

You wonder why anyone would get into that business, it's just so darned marginal. Can't imagine why the barons don't just quit and start buying and selling on eBay, which I understand from our vice president is incredibly lucrative. I'd write more, but I just got an email from the former Grand Panjandrum of Erehwon that if I send him a mere $1,500, I'll be in line to share in $6.3 million he ripped from from his government before being deposed. I'll cut your freeper friend in for a full share if he sends me $500. Small, unmarked bills with nonconsecutive serial numbers only, please.

[ComerPerro]

13. Not suprising. The "low profit margin" arugment has been going around

but, but, oil companies have lower profit margins than many other private companies...

True. But other companies have higher profit margins because they don't corner the market, and they don't sell something that almost every American needs to purchase on a recurring basis.

For example, dairy farmers can justifiably have higher profit margins because not many Americans need to purchase 10 gallons of milk each week just to earn a living.

[rman]

16. WP: Profit Soars at Exxon Mobil

http://www.washingtonpost.com/wp-dyn/content/article/2005/07/28/AR2005072802085.html

Guardian: Record Shell profit spurs windfall tax calls
http://www.guardian.co.uk/oil/story/0,11319,1405766,00.html