Have you heard the left and even the right yowling about taking away the oil company "subsidies?" Here's an explanation of what a subsidy is. I believe the government is purposely redefining the term "subsidy." They are creating confusion over what the word "subsidy" has historically meant. A "subsidy" is something GIVEN to companies, like outright grants, a gift of money. That is what the green energy companies are getting right now from both federal and state governments. GRANTS, GIFTS, HERE IT IS, SPEND IT TO PUSH A POLITICAL AGENDA, GREEN ENERGY.
The oil companies, and hundreds of thousands of other big and small companies, do not get "subsidies" or "grants" for the production of fossil fuels. They get nothing more than accelerated depreciation, and the oil companies also get depletion breaks. The "subsidies" are nothing more than tax breaks, not gifts. And the government has forever used them to mold public policy like pushing wind and solar and green cars. By the way, ALL U.S. COMPANIES qualify for the depreciation breaks made available by tax law. And if you believe "these big companies do NOT pay their fair share of taxes," remember, Obama's pal, GE, has admitted they paid nothing. They took advantage of available tax breaks.
But Exxon oil, according to their first quarter filed reports, had a net profit of 10 billion dollars on 114 billion dollars in gross revenue. That is a profit margin of 9%, up very slightly from their last report. About 3% of Exxon's oil business is in the U.S. For every gallon of fuel they manufacture in the U.S. they earned 2 cents. That's not a typo. It is two cents. So while Exxon Mobile gets 2 cents from each gallon of gas, the federal and state governments take in between 40-60 cents in taxes. See who gets the biggest share of the fuel "pie?" It isn't the oil companies.
The real reason we have $4 per gallon gas and rising is the Feds printing money and monetizing the U. S. debt. That action, which I believe has never been done in the U. S., causes intense out of control inflation. That and the fact that Obama has virtually shut down oil production in the Gulf and Alaska. Do you remember during the campaign when Obama said because of his energy policies "energy prices would necessarily skyrocket." Looks like he meant it.
There is no one to blame for the price of gas except Obama and the Federal Reserve puppet Bernanke. But don't expect the increase in the price of fuel and food to show up in the "accurate" inflation figures coming out of Washington. In case you didn't know, the Washington number crunchers responsible for reporting the real inflation number don't include fuel and food in their calculations. What does that tell you about the accuracy and intelligence of the Washington calculators?
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