WASHINGTON - The chiefs of five major oil companies defended the industry's huge profits Wednesday at a Senate hearing where lawmakers said they should explain prices and assure people they're not being gouged.But if that's the case, how do they explain this?
ExxonMobil, the worlds' largest privately owned oil company, earned nearly $10 billion in the third quarter. Raymond [Lee Raymond, chairman of Exxon Mobil Corp.] was joined at the witness table by the chief executives of Chevron, ConocoPhillips, BPAmerica and Shell Oil USA.Well, if you have lots of lawyers and lots of statistics and lots of doubletalk, (and lots and lots of chutzpah) you can explain away almost anything. Truth is the first victim....
Together the companies earned more than $25 billion in profits in the July-September quarter as the price of crude oil hit $70 a barrel and gasoline surged to record levels after the disruptions of Hurricanes Katrina and Rita.
Raymond said the profits are in line with other industries when profits are compared to the industry's enormous revenues.Of course we know they were telling the truth, right? After all, they were testifying before Congress? Well, not exactly. They really didn't want to be there, and they didn't want to promise to tell the truth. They refused, with the approval of the GOP, to testify under oath. They refused to swear to tell the whole truth and nothing but ...
Democrats had wanted the executives to testify under oath, but Republicans rejected the idea.So, if they refuse to testify under oath, in effect if they refuse to affirm that what they're telling Congress is actually the truth, why bother showing up at all? Simple, they're trying to diffuse a bomb. A windfall profits tax bomb.
"If I were a witness I would demand to be put under oath," said Sen. Daniel Inouye, D-Hawaii.
A number of Democrats, joined by a few Republicans, have called for a windfall profits tax on oil companies.Given the threat, why would the oil executives WANT to testify under oath. Why would they WANT Congress and the American public to know the truth? The truth that they've used natural disasters to gouge the American public at unprecedented levels. Well, they don't want us to know the truth. That's the strategy. Lie, but look sincere. Hope no one notices the elephant in the corner.
-snip-
The executives hoped to dampen any further momentum for calls for taxing windfall oil company profits, something still viewed as a longshot but also no longer out of the question. Such a tax could inhibit investment in refineries or oil exploration and production, the industry argues.
The oil industry's record third-quarter profits -- at a time when motorists were reeling from unprecedentedly high gasoline costs and warned of huge heating bills this winter -- have caught the attention of both Republicans and Democrats in Congress. Some analysts predict the 29 largest oil companies will earn $96 billion this year.$96 billion? $96 billion? That makes for some hefty executive bonuses, I'd surmise. Provided, of course, that by blowing smoke at Congress (and at us) they get to keep it.
And so it goes
6 comments:
But but but the private market blah blah blah...No such thing as price gouging!
But but but we can't interfere with free enterprise, after all, we're STOCKHOLDERS!
Yeah..we need to let free enterprise determine everything. I forgot.
Oh no, a company actually trying to make a profit? I thought they just worked for free.
I guess the government should just take away profit from companies who make too much, hm?
But you do realize that profit is the whole realize for their existence. So taking away the ability to create wealth is taking away incentives to operate.
And, have we forgotten what happened last time something like this is done?
Speaking of profit, Oil companies have a low profit margin compared to other industries.
Coca-Cola: 27.6% of revenue
William Wrigley Jr.: 15.6% of revenue
Wells Fargo: 20% of revenue
Altria: 10.7% of revenue
Kimberly-Clark: 10.5% of revenue
Anheuser-Busch: 15.1% of revenue
Exxon Mobil: 9.8% of revenue
(source for profit margin figures: http://www.forbes.com/newsletter/2005/11/07/exxon-coke-wrigley-in_js_1107soapbox_inl.html)
Who are you trying to convince, me or yourself?
I don't decry profits; I do object to excessive profits, I object to government-allowed collusion and I object to industry-wide price fixing.
Ok anon..Let's just charge you $5.00 a gallon for gas so you can improve the margin of the Oil company. Even though their margin of profit is smaller, the aggregate amounts are outrageous and as a direct result of predatory and collusion based anti-trust type practices they are most likely engaging in. The price of that commodity is not as sensitive as it is made out to be (trust me I work in a commodity business and gas shouldn't fluctuate as much or as often at the pump according to the economic market models thus it suggests illegal activities in their pricing)
Thus it is not reflecting the true market supply and demand price of the product either, so you "free market" people should also get mad about what they are doing.
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