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ExxonMobil shatters US profit record

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cch5432

cch5432

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But the bolded does not seem to be occurring as record profits are going into the owner's pockets while the workers are being laid off.

I disagree. There is a reduced exploration, drilling, etc.- that is why workers are being laid off; the companies are laying back. Even the very idea of more profit taxes makes each expenditure more risky. I was reading an article today that said, in 1993 when there was talk of regulated healthcare, there was an estimated $7 billion decline in R&D among pharmaceuticals, even though no bill was ever passed (I emailed the author's article, hopefully I will get a response soon enough). The bad economy coupled with the talk of windfall taxes is enough to scare these businesses away from taking more risks.

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cch5432

cch5432

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Why do we criticize them for what we ask of them as investors/owners?

 

:thumb::thumb: Exactly. The way to hit these companies is not extreme taxation (which hurts everyone) but by not investing in them. If it bothers you that these companies break record profits but lay off workers, then the most responsible action is to refrain from investing in and using services from these companies. If it goes against your conscience refrain from giving them your money. A good old-fashioned boycott, if well organized, can do wonders. However, telling Big Brother to fix the problem will only hurt everyone.

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PureFan

PureFan

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:thumb::thumb: Exactly. The way to hit these companies is not extreme taxation (which hurts everyone) but by not investing in them. If it bothers you that these companies break record profits but lay off workers, then the most responsible action is to refrain from investing in and using services from these companies. If it goes against your conscience refrain from giving them your money. A good old-fashioned boycott, if well organized, can do wonders. However, telling Big Brother to fix the problem will only hurt everyone.

 

:thumb: Great point!

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woodsrider

woodsrider

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:thumb::thumb: Exactly. The way to hit these companies is not extreme taxation (which hurts everyone) but by not investing in them. If it bothers you that these companies break record profits but lay off workers, then the most responsible action is to refrain from investing in and using services from these companies. If it goes against your conscience refrain from giving them your money. A good old-fashioned boycott, if well organized, can do wonders. However, telling Big Brother to fix the problem will only hurt everyone.

That's not an option with the oil companies. Unless you plan to walk everywhere you go and heat your home with a wood burning stove.

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cch5432

cch5432

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That's not an option with the oil companies. Unless you plan to walk everywhere you go and heat your home with a wood burning stove.

Marathon has not done as well as the other oil companies (because their business strategy is more on the refining process so they don't benefit at all from high oil prices). If the large profits bother you, go to Marathon.

 

Anyways, what's the better solution? Personally, what Exxon is doing doesn't bother me so I have little incentive to search for the ideal situation. But I do know what won't work.

They are an oligopoly. Who do you boycott?? and how do you survive while doing it.

I believe that the energy market is, unfortunately, a natural oligopoly. I am not very familiar with the various government regulations (I do know that the various rules on drilling can only hurt) and barriers to entry in the industry. And to be honest, I'm not familiar with the positions that a government can take to bust up oligopolies without severe unintended consequences. I do know what won't work though.

 

It's not just buying gas, of course. The same thing goes for investing in the companies. People rail against these companies but put their money in there. People need to not invest against their conscience.

 

Fortunately, it really doesn't weigh on my mind very much. I can't really say I blame the gas companies for what they do.

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woodsrider

woodsrider

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Marathon has not done as well as the other oil companies (because their business strategy is more on the refining process so they don't benefit at all from high oil prices). If the large profits bother you, go to Marathon.

 

Anyways, what's the better solution? Personally, what Exxon is doing doesn't bother me so I have little incentive to search for the ideal situation. But I do know what won't work.

 

I believe that the energy market is, unfortunately, a natural oligopoly. I am not very familiar with the various government regulations (I do know that the various rules on drilling can only hurt) and barriers to entry in the industry. And to be honest, I'm not familiar with the positions that a government can take to bust up oligopolies without severe unintended consequences. I do know what won't work though.

 

It's not just buying gas, of course. The same thing goes for investing in the companies. People rail against these companies but put their money in there. People need to not invest against their conscience.

 

Fortunately, it really doesn't weigh on my mind very much. I can't really say I blame the gas companies for what they do.

I never said I had a problem with it. I was only pointing out that your solution of go to the guy down the street just doesn't work. If you boycott Exxon and use Marathon guess what happens. Nothing. If everyone boycotted Exxon and went to Marathon, guess what happens. Marathon has to buy their gas / oil from Exxon to make up for the increase in the demand for their product.

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cch5432

cch5432

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Even the very idea of more profit taxes makes each expenditure more risky. I was reading an article today that said, in 1993 when there was talk of regulated healthcare, there was an estimated $7 billion decline in R&D among pharmaceuticals, even though no bill was ever passed (I emailed the author's article, hopefully I will get a response soon enough).

What I originally said was incorrect. The article spoke about in the early 1990's, when Hilary Clinton's HealthCare Task Force considered price controls, here is what happened:

 

Hangover Without the Party: The Impact of Threatened Drug Price Controls on Pharmaceutical Investment:

 

During the period when the threat was most credible, the growth rate of expenditure on research and development dropped to the 6-7 percent range (Figure 1). After the threat receded, growth in R&D returned to its double-digit levels. Had R&D growth remained at least 12 percent during the threat period, cumulative investment for the years 1994-1998 would have been nearly $7 billion greater.

 

The point is that even the discussion among Congress of policies that will hurt businesses and therefore the economy in the long-run often have drastic consequences. This is why solutions must be very carefully constructed, and it can never be as simple as "raise taxes on them."

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