Barack Obama’s Economic Ignorance: More Taxes Means Less Oil (And Higher Prices)

Barack Obama has of late sent insults in the direction of John McCain saying McCain has little economic knowledge.

I don’t know what level of understanding John McCain has, but I do know that Barack Obama has an even lower level of understanding. Take Obama’s proposal to tax the oil companies and then redistribute the wealth to Americans in the form of $500 and $1000 checks. (Nothing like buying a few votes, eh?)

Investor’s Business Daily has some commentary on this tax-scam:

Illinois’ senior senator, Dick Durbin, recently declared that, “The oil companies need to know that there is a limit on how much profit they can take in this economy.” Why is there no limit to the increased taxes Obama and the Democrats want to take in this economy?

Why is it that Socialists always think that government has more right to private money than does the private entity that earned that money? Why do Socialists like Durbin and Obama think that the working American is some sort of bottomless well of funding?


Obama once called the McCain-supported plan for a gas-tax suspension a “stunt.” Now he wants to take a “reasonable amount” of oil company profits and rebate, a la George McGovern, $1,000 to families and $500 to individuals as a part of a second stimulus package to offset high gas prices, a big part of which is federal, state, and local taxes on both oil producers and consumers.

Obama does not define what a “reasonable amount” is. Nor does he define at what point profit, which is an indicator of success and not greed, becomes a windfall. Exxon made a dime on a dollar in 2007. The oil and gas industry as a whole made 8.3% compared with 8.9% of all U.S. manufacturing. Meanwhile, the federal government operated at a huge loss.

Electronics company LG saw its profits grow by 505% in 2007. Abbott Laboratories saw its profits soar 110% Google had a profit margin of 25.3%, more than double Exxon’s. GE’s profit was 10.7%, about the same as Exxon’s, but do its subsidiary media outlets such as NBC and MSNBC report that?

So, if a profit margin of 8.3% is “price gouging” than why are all the companies and corporations who pull in profits over 8.3% not being dragged before Congress?

Because the oil companies are not price gouging in any way, but the Socialist Dems are hoping that you and I will not be smart enough to see it. Their hope is a futile one because I do see it.

And how much does the government make on gasoline in the form of taxes? Check out the graphic below:

Government taxing makes up 13% of the price of a gallon of gasoline. That’s four points higher than the 7.4% the oil companies are making (on gasoline alone). So, why isn’t Congress investigating itself for “tax gouging” the price of oil? Getting rid of the Federal gas tax would take the price of a gallon of gas back down below $3.50/gallon. That would be a very good start.

Barack Obama is the ignorant one here and his blind followers, Pelosi, Reid and Durbin, are equally ignorant.

You can access the complete article on-line here:

More Taxes Will Mean Less Oil
Investor’s Business Daily
August 5, 2008

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