Monday, June 09, 2008

Oil Windfall Tax: A Good Idea

Reuters: Obama backs oil profits tax

After gas prices skyrocketed pass $4 last week, and as they continue to head up this week, some may have been hoping for a quick fix in the style of the (completely useless) economic stimulus some weeks ago. In response to those concerns today, Obama pledged to raise taxes on windfall oil profits if elected. This position would be politically unsustainable for the simple reason that nobody wants new taxes in a time of an economic downturn, so Obama appended to his position that he would "use the money to help families pay for their skyrocketing energy costs and other bills."

Several weeks ago, a bill was blocked by Republican opposition that would have repealed tax cuts for oil companies and instead used the 10-billion-something-dollars to pay for tax rebates for renewable energy.

A good idea

If the plan Obama has proposed was enacted in coordination with the repeal of tax cuts, it would be a good move for the economy of the U.S., our long term safety, and our long term economic outlook. The windfall tax profit would have help boost the economy through its profits, but, as well, would raise gas prices, as would the repeal of tax cuts. Though that may damage the economy in the short run, in the long run, it would save much time in effort. First, if gas prices were higher, hybrids, all electric cars, and renewable energy would look much more attractive to the average consumer. Second, if some of the pain of fighting global warming is felt now, it won’t be felt later, when it could come in a large burst after the approval of a cap and trade program.


Ken said...

The manufacturing guys over at Evolving Excellence had a good post today on "big oil" relatively low profit margins, but with a twist. Did you know the endowments of Harvard, Yale, and others went up over 20% last year? Those private universities are just sitting on the cash, while Big Oil is at least reinvesting in new energy sources (even green) and paying dividends to help support little old ladies in retirement. They reference one WaPo article that says Big Oil profit could educate 60,000 kids... well the increasing endowments at Harvard could let Harvard build a dozen more Harvards and educate that many kids each year. Who should get nailed with a windfall profits tax?


Bobby said...

Cheers for Obama

Chester A. Evors said...

We don't need oil, need to change to hydrogen. The Government uses in all submarines, space stations and even helicopters. so it is not only used but tested but the oil cartel doesn't want it to be known or available.
The first engine was built to run on hydrogen for the smartest people in the world not only knew of the hazards in our invironment but our health as well with the use of petro.
Not only did the engines last longer with very little work or upkeep but with hydrogen there was no emission problems, just clean drinkable water.
Hydrogen is the largest commodity on earth and replenishes itself.
BMW had hydrogen cars for over 15 years but the oil cartel prevented them from having fuel stations.
Oil has controled the world for over 100 years with little concern about the future of the world or its people.
It is time to just stop giving a trillion dollars a year to the oil cartels and build more hydrogen stations.
You can get hydrogen out of water as the submarines do and you still have the water only cleaner.
Because of our health problems we need to change just check out the AMA who has been trying to warn us but the media doesn't really let us see it. Just little articles on the back page of newspapers etc.
California has started installing a few hydrogen stations and plan on it along the coastal highways.
Honda is bringing a hydrogen car and so is BMW finally to California.
From what I hear hydrogen is 8 dollars a gallon, but only has about six stations now.
Riverside has built their own hydrogen station used for school buses and small gov. pickups.
So far the children haven't been late so must be working fine.
So no more tax just stop giving our tax dollars to them and invest in hydrogen.
We will never be oil free for we do need it for lots of things, just not in our cars or any engine.

Anonymous said...

Wait to see what warming really is.


zimseoguru said...

right on Obama