Thursday, October 27, 2005


Exxon Mobil announced an almost $10 billion profit for the 3rd quarter of this year. That's not $10 billion for a year, that's $10 billion for a three month period. It's the highest profit by a publicly-owned company ever in the history of the world, breaking their own record which they set last year.

I...don't even know where to begin...I'm driven to write something about this after watching (on C-Span tonight--can't find a link) several Democratic senators (Stabenow, Schumer, Dorgan, Dayton) decry these exorbitant profits. Schumer had a good point that the oil company mergers of the last several years have greatly decreased competition, thereby effectively making the ol' standby of "supply and demand" kind of a moot point.

None suggested getting off oil.

They had some "solutions" but the only one I can remember is something easily demonized by Rush and Fox--a tax on windfall profits.

Republicans--This is America?

Dennis Hastert's suggestion for how to handle the coming high natural gas price/low winter temperature crisis was to "keep the thermostat down" (how far down is "down", one wonders--would he have us keep it high enough to not freeze to death?). He also suggested that citizens "drive less." He acknowledged that oil companies are posting record profits, which he justified with the deceptively simple and seemingly innocuous phrase "This is America." He said "oil companies are making record profits, but that's all right--this is America."

Then he said that he and other people on Capitol Hill are turning off lights when they leave rooms and turning off computers and computer monitors when they're not being used.

He also said something I didn't expect him to say--something that seems contrary to what the usual Republican spin on the economy is. He said that "these are tough times."

What the fuck are we gonna do about this?

Well, I can tell you who's not having "tough times." Exxon Mobil. They're having a great time. On their website, they try to justify their record-breaking/setting profit by claiming that their profit-per-dollar is in the same range as other U.S. corporations.

Here is a sample of how they put their profits "in perspective":

The total earnings numbers in the news reflect not just performance but also the company’s significant scale and global scope. For example,
ExxonMobil’s investment of $106 billion in property, plant and equipment
alone exceeds the GDP of many of the countries of the world.
These earnings, over two thirds of which stem from non-U.S. businesses, enable
us to take on the challenge of meeting the world’s vast and growing energy

Hmmm...I don't have the time, inclination, or energy to search for a link or links to document this assumption, but the part about two-thirds of their earnings "stem from non-U.S. businesses" is a shorthand, bloodless way to say that their supposed 8% profit margin is realized by hiring workers in their "non-U.S. businesses" at barely a living wage with no health care, no benefits, etc. And that's not even going into the offshore tax shelters and tax cuts and other corporate welfare they are almost certainly receiving.

The Profit over People part

And that brings us to the profit over people part of this already too-long blog entry. I was amused by the simple, no-nonsense way the AP story accounted for Exxon Mobil's profits--"Thursday's outsized earnings are a result of surging oil and natural gas prices that pushed pump prices to record territory after Hurricane Katrina." I liked the Reuters take on it also--"Record profits for Big Oil at a time when consumers are paying sky-high prices for gasoline have brought calls for a windfall profits tax".

In other words, Exxon made more because they charged us more.

But I wasn't able to suddenly and inexplicably charge my employer more for my services, were you? As a result, I not only didn't have a record increase in profits this quarter, I had no increase at all.

But a monkey could do what I do for a living, that's why I don't get to set my price. Not many people or companies can do what Exxon does (as Schumer pointed out), so they should be able to charge whatever they feel like charging, right? That's the free market, loser.

Well, that ain't the "free market." Again, as Schumer pointed out, a "free market" would have competition. And also, as Stabenow pointed out, gasoline is a necessity, not a luxury. That's why these companies shouldn't be allowed to charge simply what the market will bear.

But Hastert has the solution--just drive less. Does Hastert think that everyone in America lives in a convenient little town square where everyone's office, day care, grocery store, hospital, church, etc. is within walking distance. Does Hastert think every small town has a robust public transit system?

Because if that were true, his exhortation to simply drive less might make some fucking sense.

And for those of you who still don't think that Exxon Mobil and corporate America in general are about profit over, and the expense of, people, here's an "oil analyst" from the same AP article mentioned above:

"Exxon is a good corporate citizen but it does not work for the welfare of the country," said oil analyst Fadel Gheit at Oppenheimer & Co. in New York.

No shit, Sherlock.


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