I know, I know – it is the shareholders that will not allow that. The entire house of cards is built on greed – corporate and shareholders – even at the expense of the rest of their countrymen.

Nancy Boyda is trying to feel your pain. She is appealing to the masses. But she is history. She failed in Congress, just like Jim Ryun.

They didn’t send anyone any money. The editor acts as if a private corporations earnings “belong” to the government. Good grief, how far have we come?

Tax breaks for exploration and improvements – go ahead take them away.

Oh, so your argument is that the companies aren’t receiving tax breaks. That’s nice, then there won’t be an issue concerning removing these tax breaks.

These mom and pop shops that operate internationally, how many of those are there? You know, the ones you claimed will be affected by the change in the tax rules? How many wells in Kuwait or Nigeria does ma and pa Kettle from Russell, KS have over there?

It’s nice that you contradict yourself. If the companies get their oil from elsewhere then there is no argument that the subsidies are needed to create jobs in America. The companies are receiving record profits so the argument can’t be that they need the tax breaks or else they’ll go belly up. So what is the reason for the subsidies exactly?

“The point is to allow gains to be immediately offset by losses, in order to allow more money to be available for exploration.”

Oh, so the companies are suffering financially and need the $18 billion dollars or they’d just go bankrupt because they can’t draw that $18 billion from their $123 billion in profits.

Let’s use Paul’s reasoning. I want to be in hula-hoop selling business. I know I’ll be big so I’ll buy a million hula-hoops. I should get a tax break from the government in order to offset any potential loses. Therefore I’ll get the hula-hoops at a discount which will put me at an advantage against my competition that do not get government subsidies. I can call this the free market system.

Sorry Pauly, you are clueless about the issue. You were clueless about who would have their subsidies removed so why should I believe that you are suddenly knowledgeable about the subject now?

Want to take a guess on what the profit percentage of Quik Trip is?

How about Nike, they pay their employees in Vietnam, 59.00 a month. Gee I wonder what kind of profit percentage Nike has?

It is supply and demand people. Like I’ve said before, I have a 70 mile round trip commute each day. I drive on the interstate most of that trip. I drive 55. This has increased my MPG from 38 to 43.

And yet I still see big ol SUV’s and others passing me at 70-75 MPH. If you won’t even get up 10 minutes earlier to head to work and slow down to 55 just to save your OWN pocketbook, then you still have to much money to be pissing away, so I say keep raising the prices. My 401K has oil investments, so just keep on speeding you morons.

And yes, postponing the tax for the summer is an idiot idea, no matter who came up with it.

Also, the cost of drilling non-productive wells is built into the cost of doing business. The oil companies would have to be really stupid to think all wells drilled will be productive. For the government to subsidize that cost for the companies is rather stupid as well.

Lets take that a bit further: Joe Blow invents a widget, markets it, and it fails. He asks the government to subsidize his loss, and keeps doing this, with a 50% failure rate, paid for by Uncle Sam. Kinda takes the business side right out of the equation, and inserts welfare. Kind of what we have with oil companies now.

My guess is if big oil were cut off from the welfare, they would far less failed drillings, and more productive ones. After all, if it’s your money . . .

Haven’t looked at the specifics, but let’s say you’re right. Are the oils companies being treated unfairly then?

Well, the thing that bothers me is, while they big producers continued to haul in billions of profit, the prices kept going up. How is this? The law of supply and demand, of course. But it also showed that they didn’t need to raise prices to make a healthy profit.

A lassez-faire perspective might say “So what?—that’s business!”. . . but there’s a problem. For most people in America, using oil is as neccessary as breathing. People may drive less , yes, but commuting to work, shopping for groceries, etc. are not optional things. Hence the natural market corrective–less consumption–is out of synch with thr price rise. People pay thru the noise because they have no choice .

And also: I bet if you correlated supply/demand with the price hikes, you find, quite naturally, that price increases have far exceeded what one would expect.

Bottom line: Big Oil is gouging America, and getting away with it.

Exxon does NOT produce that much oil, domestically. A very large portion of what Exxon sells, in the United States, was produced elsewhere.

Especially in Kansas, oil production is a much smaller operation.

The point of the tax laws is not to “subsidize” anyone, where oil exploration is concerned.

The point is to allow gains to be immediately offset by losses, in order to allow more money to be available for exploration.

In the end, total profits and total losses are not effected by these tax laws.

Companies are just allowed to “balance” the two, a great deal quicker, with the IDC rules.

That is not true.

You do not know what you are talking about.

As I understand it, the tax break that would be rescinded, applies to all manufacturers now. So, in fact, they are not being favored above other industries, but under the proposal, would be treated more harshly.

To add to the technological problems with drilling for oil, you need an areas with political stability. For example, If countries like Nigeria could quell the rebel uprising, there would be more oil from those conventional oil fields.

If the consumer is willing the pay for oil at the price it takes to get it, the explorers will continue to stretch the limits of technology (and commercial diplomacy) to go out and get it.

Without big profits, oil companies would prepare for a downsizing and stop exploring. Again, generally speaking, more profit to the oil companies today yields more supply to the consumer tomorrow.

However, with peak oil here, do we really want to continue our dependence on oil? Do we really need to spend more money building and repairing roads when Americans will doubtless be driving less as time goes on?

It’s probably true that the oil companies would respond to such a government action by increasing prices at the pump. They also have other means of retaliating. Thus is requires both political skill and considerable clout to tangle with them.

This requires, very roughly speaking, to encourage actions good for America and discourage those which are bad. To do this right means actually using government, i.e. targeted policies, perhaps grants that are budgeted for and accountable to the taxpayers. With the current deficits, using tax policy to do that–i.e. just blanket forfeiting of revenue–is just irresponsible, period.

Why? Why should they be limited to the extent no other company in the US is? Exxon mobile profit margin for 2007 was about 10%. Last years average inflation rate was 2.85%. SO a 3.85 or 7.85 percent margin, lower than most of industry, should be the standard for the oil industry, according to you. Again, why? Other than not wanting to pay higher prices, why?

Mom and Pop enterprises like Exxon? The top five oil companies made profits of $123 billion. Cutting $18 billion out of that won’t affect them. And the tax bill rescinding those tax breaks would affect just those five companies:
http://www.washingtonpost.com/wp-dyn/content/article/2008/02/27/AR2008022702635.html?hpid=topnews

So don’t worry about ma and pa working in Shell fields, their company is doing quite well.

http://www.industryweek.com/research/iw50best/2007/iw50Bestnames.asp

It’s no big surprise that Tiahrt receives more in bribes, er campaign donations, from oil companies than the vast majority of people in the House. Tiahrt actually ranks fifth amongst House members in receiving money from oil companies:
http://www.opensecrets.org/industries/recips.asp?Ind=e01&cycle=2008&recipdetail=H&Mem=N&sortorder=U

No wonder he is opposed to removing those tax breaks, it may just hurt the amount of money he receives. And if he doesn’t get those donations, then he might have to pay for gas out of his own pocket like the rest of us.