Of course this is from the same misguided soul who sez: “being a successful small business is not about creating a profit…”
He’s right, but he doesn’t know why…creating a successful small business is about creating cash flow 
~Matt
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All though I’m not for his reasoning for doing it, I’m 10000000% for removing tax breaks for oil companies.
~Matt
Yeah, I’d rather see something like this:
*WASHINGTON - President Barack Obama says it’s time to roll back “billions of dollars in tax breaks” for oil companies and use the money to reduce the federal deficit. *
It doesn’t matter what they do with the money if they tax oil companies more then consumers will pay more at the pump. Companies don’t pay taxes, consumers and shareholders do. Something the morons in the govt still don’t get.
It doesn’t matter what they do with the money if they tax oil companies more then consumers will pay more at the pump. Companies don’t pay taxes, consumers and shareholders do. Something the morons on this board still don’t get.
I fixed it for you. Your welcome! (>:
Right. That makes this good policy then. He’s implementing higher gas taxes in a much more politically palatable way. A genius move, in fact.
I was commenting on his failure to mention that all of this will be passed on to the consumer. Something he forgets to mention, but is fully aware of, quite often. Of course that only applies until he can get price control on every business he sees as evil. That is his “I have a dream” moment.
And the OP may want to read up on how oil prices are determined.
Yes, that had me laughing.
His complaint is that Obama doesn’t understand economics? Lol!
if they tax oil companies more then consumers will pay more at the pump. Companies don’t pay taxes, consumers and shareholders do. Something the morons in the govt still don’t get.
Unless I’m mistaken this statement isn’t about increasing taxes on oil companies but eliminating subsidizes to oil companies.
Frankly I don’t care if consumers pay more at the pump or grocery store, whether it’s because of eliminating subsidies to oil companies or farmers.
If he was talking about increasing taxes I would be against it, but decreasing subsidies I’m for.
~Matt
if they tax oil companies more then consumers will pay more at the pump. Companies don’t pay taxes, consumers and shareholders do. Something the morons in the govt still don’t get.
Unless I’m mistaken this statement isn’t about increasing taxes on oil companies but eliminating subsidizes to oil companies.
Frankly I don’t care if consumers pay more at the pump or grocery store, whether it’s because of eliminating subsidies to oil companies or farmers.
If he was talking about increasing taxes I would be against it, but decreasing subsidies I’m for.
~Matt
Eliminating= higher costs for the companies which means it gets pased on to the consumers.
I was commenting on his failure to mention that all of this will be passed on to the consumer. Something he forgets to mention, but is fully aware of, quite often. Of course that only applies until he can get price control on every business he sees as evil. That is his “I have a dream” moment.
And the OP may want to read up on how oil prices are determined.
Yes, that had me laughing.
His complaint is that Obama doesn’t understand economics? Lol!
Oh please educate us on how this will not raise prices.
if they tax oil companies more then consumers will pay more at the pump. Companies don’t pay taxes, consumers and shareholders do. Something the morons in the govt still don’t get.
Unless I’m mistaken this statement isn’t about increasing taxes on oil companies but eliminating subsidizes to oil companies.
Frankly I don’t care if consumers pay more at the pump or grocery store, whether it’s because of eliminating subsidies to oil companies or farmers.
If he was talking about increasing taxes I would be against it, but decreasing subsidies I’m for.
~Matt
Eliminating= higher costs for the companies which means it gets pased on to the consumers.
If it is a tax subsidy from the gov’t how are you not paying for it already? Does the government just get to give back money without anyone paying for it? (Actually they do, what was I thinking…) At least if the people buying oil pay for it’s real price then that can only be a fair thing.
Since it is a tax subsidy rather than direct spending, one could argue that they are just “not collecting a tax”…they aren’t actually giving the oil companies dollars. However, the effect is the same. If they allowed me to not pay property, income, sales tax, etc., but I still enjoy the benefits of government (schools, police, etc) then it is the same thing as giving me somebody else’s tax dollars.
You also have to remember that only 56% of us actually pay federal income taxes, so by moving the “tax” to the pump, you are forcing all gas consumers to pay the tax rather than just people who pay income tax. And they are paying it based on how much they use gas, rather than based on the complicated formula used to determine income taxes.
I’m completely in support of eliminating oil subsidies and moving the costs of consumption to the point of purchase. In fact, they ought to start adding a “gulf clean-up” tax to the gas pump right now.
if they tax oil companies more then consumers will pay more at the pump. Companies don’t pay taxes, consumers and shareholders do. Something the morons in the govt still don’t get.
Unless I’m mistaken this statement isn’t about increasing taxes on oil companies but eliminating subsidizes to oil companies.
Frankly I don’t care if consumers pay more at the pump or grocery store, whether it’s because of eliminating subsidies to oil companies or farmers.
If he was talking about increasing taxes I would be against it, but decreasing subsidies I’m for.
~Matt
I’m not totally sure I understand exactly what you are saying here. I don’t think it matters what term is used the end goal is to increase the cost of doing business for Big Oil. What does a farmer have to do with this? That one has me curious.
I think I wish I had your job. You don’t care if anyone pays more, so by extension you don’t care about inflation. You must make a ton of money to not care what you pay for stuff. (sidebar: I want new wheels if you have some cash you don’t need.)
Regardless of what is read in the press or what quotes are cherry picked from the press conference once thing is certain: Oil and gas are political. As much as anyone wants to believe that this (Deepwater cirsis aside) is about Big Oil profits it’s not. Everything the administration is doing now related to this is about furthering their agenda. Big Oil is just the lucky one to be on the poster. This is like a kid in a candy store for the administration.
I think the connection is that both farmers and oil recieve a lot of tax subsidies. The small government, free-market libertarian ideal that many, including myself, strive for would eliminate these sorts of subsidies. The price of food and oil would perhaps go up, but it should be offset by a reduction in taxes. The benefit is that it is a much more efficient way of funding an activity, and it also provides the right incentives for consumption and production. If the cost of gas suddenly went to $15 per gallon (a realistic price when all transportation subsidies are removed), but you paid $500/month less in taxes, it would be nearly a break even in terms of your ability to buy gas, but you would be highly incentivised to buy less of it. The costs of shipping a new set of wheels would go up making the local bike shop (or farmer) more competative. Etc.
I’m not totally sure I understand exactly what you are saying here. I don’t think it matters what term is used the end goal is to increase the cost of doing business for Big Oil.
As I stated earlier I agree with the action, not the reasoning behind it.
**What does a farmer have to do with this? That one has me curious. **
As was pointed out by another poster, both receive large subsidies.
I think I wish I had your job. You don’t care if anyone pays more, so by extension you don’t care about inflation. You must make a ton of money to not care what you pay for stuff. (sidebar: I want new wheels if you have some cash you don’t need.)
Actually, whether thru taxes or subsidies, both end up costing the consumer more than without.
In the case of a subsidy the consumer pays taxes, which go to the government, which then go to the company. Without this subsidy the consumer pays directly to the company eliminating the cost of the “Middle man” which becomes the government. In the case of the US government on the low side you’re looking at paying 1.10$ for every dollar the government sends the company. My guess is that that number is probably much higher.
**Regardless of what is read in the press or what quotes are cherry picked from the press conference once thing is certain: Oil and gas are political. As much as anyone wants to believe that this (Deepwater cirsis aside) is about Big Oil profits it’s not. Everything the administration is doing now related to this is about furthering their agenda. Big Oil is just the lucky one to be on the poster. This is like a kid in a candy store for the administration. **
All theories and political debate aside there is no arguing that government subsidies cost the consumer more than without them. Thus the reason I’m for eliminating subsidies.
~Matt
If he was talking about increasing taxes I would be against it, but decreasing subsidies I’m for
a) increased taxes = oil companies pay more taxes = higher fuel prices to consumer
b) no subsidies = higher gross costs for oil companies = higher fuel prices to consumer
Different paths but the same destination.
An argument can be made that subsidies are an additional burden on taxpayers (not consumers) but that money will be spent on something else. I also understand the argument that the Fed Gov’t (taxpayers) should not give subsidies to private businesses and I agree. But either way the consumer pays in the end.
Eliminating= higher costs for the companies which means it gets pased on to the consumers.
As I posted to another poster.
Actually, whether thru taxes or subsidies, both end up costing the consumer more than without.
In the case of a subsidy the consumer pays taxes, which go to the government, which then go to the company. Without this subsidy the consumer pays directly to the company eliminating the cost of the “Middle man” which becomes the government. In the case of the US government on the low side you’re looking at paying 1.10$ for every dollar the government sends the company. My guess is that that number is probably much higher.
In essence your statement is incorrect. Subsidies cost the consumer more, removing them eventually costs the consumer less assuming the consumer is also a tax payer.
~Matt
the cost of the “Middle man” which becomes the government
Good points, but in reality isn’t that a “fixed cost” ?
I’m going over this several times cause it’s an important point I don’t think people get.
a) increased taxes = oil companies pay more taxes = higher fuel prices to consumer
b) no subsidies = higher gross costs for oil companies = higher fuel prices to consumer
In this case the company is having their profits removed from them. These profits are removed to create programs or worse yet subsidies for other entities. You could even look at this as the government taking money from the oil company and then handing it back to them to pay them their subsidy. If the inefficiency in that transaction is not glaringly obvious to you I’m not sure what to say.
In this case let’s say that the government is 90% efficient. Let’s also assume the oil companies get 100 million in annual subsidies. Let’s also assume the oil companies pay more taxes than they get subsidies. So in order for the oil companies to get 100 million in subsidies they must pay 110 million in taxes.
The consumer ends up paying an additional 10 million dollars in product cost for every 100 million dollars in subsidies the oil companies get under the assumption that almost 100% of oil consumers are also tax payers, which of course is mostly true.
The same can be said for farm subsidies and just about any subsidy that is “Global” in the sense that all of the users of the product are also tax payers.
So by eliminating subsidies, yes you will see an increase in oil prices, but technically you should also see the same decrease plus the gained efficiency by not having the middle man involved on the tax side.
You can also look at it this way. If government eliminated subsidies to big oil they would have an equal decrease in needed income on the tax side to cover those subsidies. So not only could they lower big oils taxes by the amount of the subsidy but they could also lower it by the cost necessary to collect, process and distribute those subsidies. That of course means big oil would actually be paying net less, which means a savings for consumers.
~Matt
Good points, but in reality isn’t that a “fixed cost” ?
Well one could make the assumption based on historical government data that they will rarely if ever truly get smaller. That of course is a different discussion.
My point is that any move in the right direction is a good move. You can’t shrink the government with everyone from the homeless to large corporation on welfare, and yes subsidies are nothing more than a fancy name for welfare.
Although one would hope the government would reduce cost when their expenditures are reduced, that rarely happens so yes one could argue it will translate to higher costs for the consumer.
Again however that is a separate discussion than if subsides cost the consumer or not. Subsides DO cost the consumer more. Assuming a zero net gain for the government what stops going out must remain in the citizens pocket, I.E. the consumer. The fact that the government doesn’t operate on a net zero gain policy is a completely different problem and separate issue/discussion.
~Matt