I am philosophically opposed to the government punishing any private corporation for making too much money, but when I hear that oil companies quadrupled their profits while gas prices doubled in the last year, it really pisses me off! As oil costs rise, I should think profit margins should shrink. A penny profit on $2.00 is a higher percentage than a penny profit on $4.00/gallon. As prices rise, naturally demand should fall as it becomes less affordable. Lower demand should result in lower sales. Lower sales + Higher prices should equal Lower Profits, right?
It’s hard to be a steadfast capitalist when you feel you are getting screwed over. Prices going up this quickly does not make any sense in a free market. Supply and demand certainly have not been altered so dramatically in such a short period of time.
Oil companies claim they use all these profits for R&D but I don’t hear of any new drilling and I don’t think there has been an oil refinery built in the United States in 40 years. What in the world are they researching? What are oil companies doing to ease the pain at the pump? Corporations should be applauded for making money for stockholders which in turn helps the economy, but I definitely don’t want to be gouged in the process. There must be something we can do besides the windfall profit tax to get their attention. They better wake up and be part of the solution before there’s another Tea Party brewing.
UPDATE:
In case there is any confusion after reading this, I am still opposed to a windfall profit tax, but I beseech the oil companies to be part of the solution before something drastic happens which is out of their hands.
If you liked my post, feel free to subscribe to my rss feeds
BlogoSquare
3 Comments so far (Add 1 more)