Monday, February 05, 2007

Yes, we have populists too

First, the facts:
Ford Motors hit by record $12.7 billion loss in 2006.
Exxon Mobil Posts U.S. Record Annual Profit - $39.5 Billion


Anyone who lives in the US can tell you why Ford is losing money: Because cars from other companies are better. It is that simple, and since Honda and Toyota have now several plants in the US that “unfair competition” excuse used in the 80s is kind of fading out.

How about Exxon? Do people really understand why they are making that much money? I don’t think so. Most important, people don’t understand who gets that profit.

I couldn’t find the numbers for 2006, but for 2005 (when profits were 36 billion)Exxon Mobil paid $7.2 billion in dividends to shareholders, and $18.2 billion in stock buybacks. Besides that, Exxon Mobile employs more than 100 thousand people.

It is also true that Exxon’s executives get a lot of money (Lee Raymond got a $400 million pay off) but to think that 39 billion just went into the pockets of a few fat cats is really a fantasy. Exxon is a public company and its stock is part of a lot of retirement funds.


You would think that Americans are actually be happy that a local company is at least making money in the energy business, since most of the oil revenues end up in the hands of some anti-American dictator anyway.

You would also think that if the government had anything to say about these two companies, Ford would be the focus. After all, isn’t it the government's job to help people in trouble?

Ah, not exactly.

Here is what Hillary said a few days ago:

"I want to take those profits and put them into an alternative energy fund that will begin to fund alternative smart energy alternatives that will actually begin to move us toward the direction of independence."

What better way to improve our energy situation than take all incentives from energy companies right?

By the way: Exxon’s exploration and capital expenses for 2006 were $177 billion, an increase of $2.8 billion over the 2004 total. The company also projects it will average about $20 billion in capital expenditures through 2010, and has some 60 projects lined up during that time.

That's a lot more than the 39 billion Hillary wants to steal.


Here is the last piece of information:

US Budget to Reach $2.9 Trillion.

That is almost 79 times Exxon’s profit, and of course, it is at the end dependent on the big chunk of revenue coming from the taxes on all those oil profits.

Man, I really hate these little games people play.