Pay Uncle Sam At The Pump

Yeah. Yeah. Yeah.

Gas Prices are going up. We all know it. They have been going up for some time now, so I don’t know where the surprise is coming in at here. In any case, Congress has recently put Big Oil under the microscope because they made a large amount of money last year. And indeed, they did! However, should we, the American Gas Buyer, be griping at them for making such large amounts of money?

My answer – no, and if you do, then you are severely uninformed. Here’s why.

Between 1977 and 2004, the oil industry’s domestic profits totaled $643 billion, after adjusting for inflation. For the same time period, [State and Federal] governments collected more than $1.34 trillion, after adjusting for inflation (link). Um, hello? If you don’t understand what I just wrote, then check out the graphic.

So who is causing the high gas prices? The government! Think about it… the oil companies actually have to work for getting that gas to you. They have to find it. Find out how to get it out of the Earth. Buy expensive equipment to drill. Have a way to obtain and hold all the oil they get. Refine it. Ship it.

And what does the government do? They see the gas truck pulling up to ExxonMobil and they slap a tax on it – a tax that is 2-3x higher than the profit that the oil company is making. BS. Pure and simple smoke screen. It is OK to cry about someone making “too much” money, but it is rude and inconsiderate to even speak about how the government is making twice as much. And for what? What is the government spending all that generated tax money on anyways? I surely don’t see it!

If you want to complain about how much the CEO and VPs are making a year, well that is a different story all together. This is about when we buy a gallon of gas, who is getting how much money. And what everyone doesn’t tell you is that the government is making more than the oil tycoons… Period.

Listen very carefully to parts 3:30-3:41.


3 Responses to “Pay Uncle Sam At The Pump”

  1. 29 May 2008 at 21:04

    Great post. I’ve got a few thoughts on this subject myself.

    First, I’m a capitalist, which means there’s no such thing as making too much money, in my book. The problem isn’t corporations or CEOs making money. The problem is when the federal government doesn’t allow capitalism to flourish for the betterment of the country. In this case, big government allows both the oil industry and the automobile industry to minimize the competition. This keeps us enslaved to both concerns, which in turn, keeps money in their pockets while robbing us of free market choice.

    So, I really couldn’t agree more about the government being responsible for high gas prices. This is in part due to not only taxes, but our government’s unwillingness to utilize our own resources. That means freeing up natural resources here at home while in the meantime, rewarding automobile manufacturers which work to make cars fuel efficient. It also means allowing other players into the game, players who want to either substantially increase fuel efficiency or who have an efficient, economical energy source for transportation. Big Oil doesn’t want fuel efficiency because it has the potential to cut into what’s left of their bottom line. (People are buying more gas than ever before and their paying handsomely for it.) Similarly, automobile manufacturers don’t want outsiders introducing other alternatives either, whether that be in the form or fuel or fuel efficient transportation. In both the former and the latter, lobbies for the oil and automobile industry keep things “safely” where they are with our legislators. And until the price of oil (45 % of the price of a gallon of gasoline) causes Americans to change their behavior, I predict things will continue on their present course. If Americans want the price of gas to go down, there’s one thing they can do right now to make it happen: stay home more and refuse to pay the asking price. It’s simple supply and demand. But we’re not willing to do that, so I’m thinking that after some Academy Award winning performances up on the Hill, gas will go down a few cents and then gradually go back up again, this time even higher than when we were screaming the first damn time. Add to that the devaluation of the dollar and you’ve got a potent economic Molotov cocktail. All this, of course is a huge factor in driving up inflation. The cost of interstate commerce is higher than ever, which in turn drives up the cost of both goods and services. Meanwhile, as your dollar buys less, you’ll be paying more at the pump, at the doctor’s office, at the grocery store, in short, anytime you have to dole out the green.

  2. 2 DJ
    2 June 2008 at 11:46

    I too am a Capitalist! I agree with everything you posted Chad and would only add that I really don’t care how high the price of gas gets. When the average Joe cannot fill his tank to get to work, some young inventor out there will (if he hasn’t already) develop the next method of propelling us around! I know for most people this is an asinine statement, but I don’t see the price of gas coming down, so the sooner folks can’t drive themselves to work the sooner the next cheap propulsion system will come along. As I see it, if Big Oil was so concerned about the world running out of oil, they (Big Oil) would be assholes over elbows into the next money making fuel, they (for the most part) do not seem to be that concerned. I think the they are waiting for someone with the Balls of Ronald Regan to get into the White house so we can screw the environmental lobby and (by executive order) start taping what we got here. Conservative estimates hold the Colorado Shale at around 1.3 Trillion barrels! That is enough oil to last about 200 years at the current production levels of Saudi Arabia, Then there is the Bakken find in the North-Central US and Southern Canada, the Oil sands in Utah… The list goes on and on. But I digress. Great post Chad!

  3. 4 June 2008 at 01:23

    Great post Chad and DJ….

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