Barack Obama recently announced that if elected President, he would implement a “windfall profits tax” on oil companies to force them to “contribute a reasonable share” of their profits to American families burdened by high energy costs. The money would come to families via rebates, or “stimulus checks,” from the federal government. And while he was obviously proud of his big idea, Obama did not bother mentioning that the Democrat practice of putting socialism first, the environment second, and the American people third, is what brought us to the brink we now face over energy costs in the first place. He also remains mute on the fact that the rebates really aren’t rebates at all, and will result in higher prices at the pump once they are issued.
Throughout his campaign for the presidency, Obama has remained aligned with the hard left because he is hard left. This is why he was so popular in Europe and why he drew much bigger crowds in Germany than he does in the United States; socialists love to hear another socialist stand up and verbally gouge out the eyes of the world’s “greediest” nation.
And now, he is talking to us as if we are European. He tells us about the unacceptable greed of “big oil” and tries to convince us to join him in his quest to take their profits and redistribute them among the people. But we are not quite European, Senator Obama, and those of us who live where we still see cowboys on horseback rounding up cattle are not overly impressed with what socialism has taken from Europeans in terms of personal liberty and national security. We actually treasure the rugged independence of the great men and traditions of this nation. Men like George Washington, Ronald Reagan, and the American soldier, and traditions such as limited government and the free market.
But Obama’s Marxism prevents him from appreciating the humble, farm loving mentality of George Washington or the unquestionable success of small governments and free markets. He does not esteem liberty much either. And because he is an ideologue, he is more concerned with protecting the environment than the people who live in it. Thus, like many of the radical eco-freaks who support him, he uses his environmentalism as a cover for harming both the U.S. market and the businesses that should thrive in it. This is particularly true when talking about oil.
When Obama announced his “emergency energy rebates,” through which oil companies would be forced to take care of American families, he told his supporters that the rebates would be funded by a "windfall profits tax.” However, like all successful socialists, he did not tell them – truthfully — what its ramifications would be. Instead, he used arguments full of philosophical straw men to bypass the minds of his listeners and go straight for their emotions. For example: When he mentioned ExxonMobil’s $10.7 billion second quarter profit, he made it sound like the company profited at the people’s expense. This was nothing less than his attempt to persuade the people that ExxonMobil’s money is their money, and that they are justified in taking it back.
Because Obama appeals to his supporters using emotion rather than reason, thinking about what he does not say is just as important as thinking about what he says. For instance, Obama has not bothered telling his audiences that ExxonMobil will spend a large part of their profit researching ways to get more oil from the meager amount of land Democrats like Obama allow them to drill and explore. He has also failed to tell his adoring fans that ExxonMobil will pay approximately forty billion dollars in taxes this year; yes, forty ($40) billion.
Because this figure is almost too large to grasp, think about it this way: According to U.S. tax records analyzed by Dr. Mark Perry, since 2005 ExxonMobil is taxed at a rate that is so high the company literally pays more taxes each year than the bottom 50% of all U.S. taxpayers combined. (The combined bottom 50% of U.S. taxpayers will pay approximately thirty-seven billion in taxes this year or three billion less than ExxonMobil.)
Moreover, although ExxonMobil is a U.S. company it is also a global marketer that only makes about 30% of its annual profit in the U.S. These things notwithstanding, our government taxes those profits at a rate approaching 45%. Where are all the “tax breaks for ‘big oil’” Obama has promised to rescind if elected? And how much higher than 45% will the tax burden on oil companies have to rise in order to please Democrats if a “windfall profits tax” is implemented? Will Obama deem a 55% tax rate acceptable, or will it need to approach 75 or 80%? In my opinion, the tax rate ExxonMobil already faces is so great they should be giving seminars on how businesses that are politically incorrect can survive the continued onslaughts of the Marxist politicians in our federal government.
Lastly, Obama does not bother telling his supporters that the ultimate burden of the “windfall profits tax” will not fall on ExxonMobil or other oil companies but on the consumers who buy the products these companies produce. That’s right – consumers will pay the new taxes for the oil companies every time they fill up their gas tanks. This is nothing new and it is certainly not an indictment on the oil companies. During the past year I have watched every business in West Texas increase prices on their products to make up for the increased shipping and transport expenses that have resulted from higher fuel costs. Therefore, whether we are talking about oil companies, coffee shops, or the corner grocery, all successful businesses raise prices in order to cover costs, and in so doing they pass their increased costs on to the consumer. (The businesses that do not do this do not remain in business long.)
So there you have it. Just as the 18th century Jacobins, and the 20th century Leninists and Maoists did not bother telling their followers of the pending costs of their revolutions out of fear that “the masses” would desert the cause, so too Obama remains silent concerning who will bear the cost of his plans in the end. But for those of us who weigh his words with our minds rather than our emotions, one thing is clear: If implemented, Obama’s plan to punish “big oil” with a “windfall profits tax” will actually prove to be just another tool the federal government can use to punish the consumer who refuses to trade in his SUV for one of those go-carts the French call a car.