Two billion dollars is enough to fund NPR or Planned Parenthood for quite a long time. :woot:

I meant a hill of beans to the oil companies.

But 35% or what ever the corporate tax rate is won't fund them for all that long. But what you say is true. The point of the discussion was who pays the tax and I say you will. Are NPR and Planed Parenthood worth the higher gas prices? Some will say yes, others no and I will ask why are we funding these kind of things in the first place? Planed Parenthood at least is a social service that many people need.

gimp "I thought that was due to people getting out of the market :hmmm:"

That's what supply and demand is, getting in and out of a market.
You buy, your in the market, don't buy your out.
If I buy a Big Mac I'm in the market, if I don't than I am not contributing to the demand. Gas was too expensive so people drove less and reduced the demand. Prices went down dramatically. The world economy is recovering and the demand has grown thus prices are going up.
When the US economy starts to really grow watch out, you ain't seen nothin yet. Making the oil companies pay more tax is just pouring more fuel on the fire.

Magic

magic, I'm not talking about trading as in supply and demand, I'm talking about futures trading for oil.

The very same rules apply.

I see what you mean and there is no doubt that traders do pump up the price but what are the alternatives, price fixing?

Don't get me wrong, I'm no big fan of the massive oil company profits and there is no doubt that they are sticking it to us, but again what are the alternatives. I would far prefer to see their personal incomes taxed that's all.

The very or super rich can certainly pay more tax but the Dems always put the limit at $200,000 to $250,00 and that is too low. Hurts too many small business owners. Put higher tax rates on one million per year and you don't raise near enough money to really help.

Change the tax laws and people will change their behavior and you don't get the revenue you expect. If it becomes more profitable to put money into something safe they will go see MookieMookie and buy bonds and not invest in business. (I think I remember MookieMookie saying he was in the bond biz.)

Do you have any idea how much it cost to open a simple thing like a McDonald's franchise. Easily a million and probably more.
And that is a business that is all set up for you and a massive marketing campaign as well. Who do you know that is willing to risk a million + on something that may fail. Not to mention the enormous amount of time and headaches that go with a small business. You deserve to make a pretty good profit and not have 30+% go to the feds and another 10 or 15% to local taxes.

Magic

Gimpy, I'm not sure what you're trying to say. Wall Street doesn't set prices on commodities - demand and availability does. Even more specifically, demand from nations with strong buying power sets international commodity prices.

If we began to reduce our dependance on foreign oil, international sellers would have far less access to easy US dollars which, at least for now, they still covet. Ergo, prices drop in order to encourage consumerism. OPEC is notorious for this. Also, I believe this is why inflation will remain in check despite our insane money printing - the world wants access to its top consumers.

Honestly, please step out from the Blue Team talking points for a moment and attempt to understand this. An independant mind is a terrible thing to relegate. Increasing oil production WILL lower prices - I'm not sure how you don't get this. Even OPEC knows this - everytime prices skyrocket and demand falters, what do they do?

Increase production.

Or fund a few mandatory job education programs for perennial welfare recipients.

Indeed. That's another side that gimpy is missing - we're sending US money out of country for a product which we could just as easily get here using said dollars.

Which means ... jobs, higher tax revenues, etc.

False. The price of oil is driven overwhelmingly by speculators. Institutional investors increased their investments in commodities from $15 billion in 2003 to between $250 and $300 billion in 2008. If 16 to 20 times more money is chasing the same relative supply (I doubt supply had increased 16 to 20 fold in those 5 years), then the price necessarily has to become inflated. And that has absolutely NOTHING to do with how much oil is being pumped out of the ground. It's supply and demand alright - the supply of investors all demanding futures contracts! In January 2006, ICE Futures in London introduced a futures contract for West Texas Intermediate crude. U.S. based investors could route their trades through London so as to avoid coming under the Commodities Futures Trading Commission's rules against speculation. Fun activity - chart the price performance of oil in 2006 (around $60/bbl) to today (around $100/bbl). To ignore the role of speculation as the driving force behind oil prices is to ignore reality.

Oil was trading at around $112/bbl two weeks ago. Now it's around $97. Did worldwide supply increase 15% in two weeks? Did worldwide demand decrease 15% in two weeks? That'd be one amazing feat if it had.

They do the only thing they CAN do. The only way they can influence oil prices, even if its to less of a degree than speculation, is to curtail supply. That is not a piece of supporting evidence for your case.

This isn't a Blue Team or Red Team issue. Quit looking at it through the lens of politics and look at the facts.

That's funny, mookie - you DO know what commodity speculation IS, right? More specifically, futures trading?

You DID know that prices in futures trading rise based upon FUTURE delivery dates and expected ability to meet that demand, right?

There's no doubt that speculation is a driving market force, but even THAT is based upon the principle of S&D. How again would increasing domestic production not impact the commodity?

I am a financial analyst at a securities firm. There would be a problem if I didn't.

You DID know you misunderstand how commodities futures contracts operate, right?

Futures contracts in the vast majority of cases don't end with physical delivery. They are settled by cash. So no, futures contracts are not limited by the amount of physical oil available for delivery on the contract's expiry date. Do you think Goldman is having barrels of crude dropped off at 200 West in NYC?

This is much the same as how credit default swaps (the unregulated derivatives that were a major cause of the financial crisis) worked. People traded the CDS contracts whose total value exceeded the underlying value of the bonds they were supposed to be insuring.

And you still didn't answer the question. Oil was trading at around $112/bbl two weeks ago. Now it's around $97. Did worldwide supply increase 15% in two weeks? Did worldwide demand decrease 15% in two weeks?

Sure corps see taxes as part of overhead, unlike most small businesses in american that don't, because of much stronger competition to survive.

But when will people get it, you could raise or cut corporate tax rates to zero and nothing would change, it's all about regulation. Thanks to our government, mostly the GOP corporate america doesn't work for america in a global economy.

The problem is as always, the GOP would under regulate, the Dems over, no one seems to have enough sense for proper regulation.

In the end the total maddness is all about government wanting as much power over the people, both parties are equally guilty.

What Congress needs to do is look at all subsidies.

At the time the subsidy was approved, there had to be a justification. Subsidies are usually granted to encourage research/development/production. In rare cases it is to discourage production.

All subsidies should be subject to a zero level review. If the original subsidy justification is no longer valid, then the subsidy needs to be stopped.

This is the problem with government programs like subsidies. They are easy to start, but hard to stop. The reverse needs to be true.

The trick is that what they are talking about is a tax deduction not a subside.

It's like the home mortgage deduction, they want to encourage a certain behavior. Home ownership, no home loan than no deduction.
If you were really serous about raising money you'd eliminate this deduction.
Course you'd have a small revolution on your hands but you would have more money.

What this deduction is doing is to get more domestic oil production, not a bad thing. If they don't spend any money on domestic oil production than they get no deduction.

The fact that the state and federal governments won't let them drill is a minor glitch in the plan.

No matter who you cut it this is all a big smoke screen.

Platapus, as far as subsidies go you are correct. There are many of that should be reviewed. "Easy to start, but hard to stop" holds true or almost all government programs. Tax deductions and subsidies and very much the same thing, deductions the government doesn't get taxes. Subsidies the government gives away tax money. Same horse different color.

Magic

I am not sure I would want to eliminate ALL of the deductions. I am, however quite firm that the subsidies need to be reevaluated and hopefully removed.

Here is a pretty good article that explains the deductions under consideration. Some of them seem legitimate

http://www.accountingtoday.com/news/...s-58330-1.html

Well I also think it's sad they're using the subsidies as a gun held to the head of america. They're making HUGE profits, but they pretend that if their tax beaks go away that they'll have to raise the price. essentially holding us american Taxpayers hostage for their cushy tax breaks. Personally, I say take away the breaks and let them try to raise prices, and then we haul them in on price gouging and profiteering, because honestly thats what it would be.