IN AMERICA IT IS “OBSCENE” TO LABEL “OBSCENE” ANY PROFIT LEGALLY PRODUCED
IN AMERICA IT IS “OBSCENE” TO LABEL “OBSCENE” ANY PROFIT LEGALLY PRODUCED
By
Ken Eliasberg
When I listen to these left-wing nut cases ranting on about the “obscene” profits produced by American oil companies — you know, BIG OIL — I some times wonder if I’m still in America. Do we not live in a society that not only acknowledges the importance of free enterprise, but deeply respects it as the fundamental economic underpinning of that society. Are we now saying that some one or some body of some ones are going to sit in judgment as to just how much money it is permissible to legally make? If that is the case, America, as we have come to know it and love it, is finished.
First of all, let’s tackle the definiton — WHAT’S AN OBSCENE PRFOFIT?
Actually, that’s an easy one — it’s a profit that our know-nothing, left-wing loonies don’t like!! Before dealing with the concept of “obscenity” in so far as earnings are concerned, let’s just briefly take a look at what Senators Obama and Clinton are proposing, a “wind fall profits tax.” We have invoked this procedure before -during the Carter years - and, simply put, it was a failure. I believe that they projected tax receipts in the neighborhood of 350 billion dollars, and it produced something around 80 billion (which was probably less than it cost to administer). During previous wars (WWII and I believe Korea) we utilized something called an “excess profits” tax, which, while somewhat more productive, still left something to be desired. The idea here is that circumstances external to taxpayer’s normal course of business have produced extraordinary returns, and, since the taxpayer’s efforts were not entirely responsible for these returns, he is somehow not entitled to all of the “windfall” element.
I have to tell you that I have some problems with the government making such a determination, particularly since the government will not be asked to step in to compensate the taxpayer in question should he suffer business reversals due to circumstances that he did not create, i.e. this is a knife that cuts only one way in your typical case.In addition, the whole idea of putting a ceiling on earnings in a free-enterprise system is somewhat repugnant to me. Why? Because I believe in the market place as the appropriate adjustment vehicle in such situations, and barring illegal conduct, I find the market place a forum that usually balances things out. In addition, the whole idea of government intervention in the affairs of the market place is repugnant to me — unless there is some clear indication of wrong doing, I don’t want someone in Washington telling me what’s a reasonable rate of return. Finally, the idea of the government being the instrumentality to effect a solution to almost any problem is somewhere between ludicrous and absurd.
Moreover, and more to the point, the Oil company’s profits are the result of our energy problem and not it’s cause. Had we given them more authority with respect to producing oil and refining it, we would not have the problem we now have — consumers would not be paying ridiculous prices to fuel their vehicles, oil companies would be doing quite well, the economy would be in an infinitely better place, and we would not be funding first our economic collapse and then our eventual destruction (via a capitulation to Islam) with petro dollars. Of this I am quite certain. But the left suggests what the left always suggests — tax it or regulate it (and this, of course, will require more laws, more government to administer these laws, and more money to pay for this addition to government — your money). That is all, of course, that the left knows about economics — tax and spend (tax to raise money, and spend to buy votes). This was Harry Hopkins advice to F.D.R. more than 70 years ago, and it has remained the center piece of the Democrat’s economic policy.
By the way, we have been down this road before — many times. Every time we have a problem with OPEC, the Dems scream for an investigation of Big Oil. The investigation takes place, no wrong doing is uncovered, and we’re back to looking for a bogey man for the Dems to use to beat up on Republicans (who, by the way, do an incredibly bad job of defending either themselves or big oil, let alone communicating to the country what the real problem is and what the solution is, i.e. DRILL HERE, DRILL NOW). If Clinton had not vetoed the ANWAR proposal some 10 years ago, we would be pulling oil out of there now (without doing any significant damage to its pristine environment). If we don’t do something about it now, I suggest you sit down and write a letter to your granddaughters telling them why their putting on a burqa and learning Arabic (and I advise you to make it somewhat more compelling than that you did it so that they could be doing these things in a pristine environment).
The problem is quite simple. We consume a substantial amount of oil, and we produce only about a third of what we need, making us dependent on foreign sources so satisfy our needs. Not only are we dependent on these sources, but some of them are very hostile to this country, e.g. Saudi Arabia, Iran, Venezuela, etc. Now does this make a lot of sense? Relying on enemies to provide for your needs? Why do we do this? Because our energy policy has been held hostage by a bunch of left-wing eco nuts for the last 50 years. And these eco-nuts hold sway over a compliant Democratic Party who seems to have lost sight of what the country should be doing to solve its energy problems (not to mention the impact on national security of following this approach). I have seen estimates of the reserves that we have access to off our own coast lines, and accessing these reserves would free us from the hold that these foreign powers have over us. We could be energy independent, and, as a consequence, a good deal safer, as well as more solvent, but the action we would have to take to be energy independent woulddo violence to the feelings of many of our tree-hugging friends on the left.I’ll have a lot more to say about this in ensuing columns; in closing here, I want to address one point that irritates me, and that is the oft-stated observation that drilling now will not solve our immediate problem. I have 2 observations: (1) So what —it will solve our long-term problem, and (2) the observation is wrong, it will have an immediate effect. I’ll bet the farm that as soon as some of our current sources see that we are ready to cut into their action, they will drop the per-barrel price post haste. We have seen recent evidence of this being the case: When Bush went hat in hand to the Saudis (who are not our friends, current propaganda, notwithstanding), all he got (twice) was sorry, we won’t do it. When they saw that there was a gathering public storm in this country, all of a sudden, they agreed to produce more oil. Do you think that that was either a coincidence or an act of friendship? If you do, think again. (to be continued)