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11.09.2005
Bloomberg.com: Top Worldwide: "Exxon Mobil Corp. Chairman Lee Raymond said Congress should avoid any policies that interfere with oil industry profits because they would discourage investments in exploration, production and refining. In essence he's letting us know that the energy companies have the power to majorly screw us over if we try to dip into their profits for the sake of providing relief. Its a threat guys. Their profits jumped over 50% in the third quarter. Of course they try to justify the high prices and the record profits by citing the damage done by Hurricane Katrina. But we have to wonder; if they were raising prices to compensate for lost production, shouldn't that offset the loses and simply allow the company to keep from losing money in the wake of a natural disaster? Instead of breaking even, or maintaining current profit margins, which might have given them some cover for the high prices, they reported their highest quarterly profit in history. They lost production but still made more money then ever before? Isn't that a bit fishy? Something tells me that they used the hurricane as cover to raise prices above and beyond a fair price. The oil companies know they walk a fine line. They want to raise prices and increase their profits, but they know that if they go too far in what looks like an arbitrary fashion, people might start thinking about moving to alternatives; lower consuming vehicles, less driving, etc.. so they have to make thier price hikes look like a natural reaction to an event. People are willing to accept short term price spikes if they feel that they are in some way justified. But they will not accept sustained price gauging, especially if it looks like profit simply for profit's sake. High energy prices have a huge negative impact on our economy. Its essentially a cost of living increase for anyone that has to use a vehicle for work or transportation. Because of our utter lack of planning when it comes to providing people with viable alternatives to cars, people are forced to keep driving even as prices double. If you factor that into the daily costs people incur, it quickly obliterates the savings some of use have seen from tax cuts. Energy cost are a fixed value, independent of income. Driving a mile costs roughly the same for everyone. So energy prices are going to hurt low income consumers the most. It eats away at disposable income very quickly. The money spent on gas for the car gets displaced other places. So here we have Lee Raymond talking about the "unintended negaive consequences" of transfering some of that profit they gained by spiking gas prices in the wake of Katrina for the sake of providing heating oil assistence to poor people? We should read his statement as it is intended, as a threat. The financial markets and the major corporations have a very clear idea of how money should flow in our economy, and they have the power to punish us if we should tamper with that lucrative cash flow. We should notice the utter lack of "unintended negative consequences" that result from price gauging, excessive executive compensation, or collusion. The intended positive consequences of their actions post-Katrina was that massive amounts of money shifted from worker pocketbooks into the hands of the major oil companies as they kept prices high. The intended positive consequences of their actions resulted in soaring stock prices for September even as we were watching people lose everything they owned. The intended positive consequence of spending over $8 million on think tank shills over the past few years to refute climate change research means that we have done little to address the issue. Funny that, ExxonMobil spends millions making sure that we stay dependent on their products, spiking prices, and paying people to refute claims that their product is causing shifts in global climate that might result in more severe weather, and they have the audacity to talk about "unintended negative consequences"? |
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