Oil Companies Ate My Raise
April 8th, 2008
By Colleen Rothe
It seems most of my efforts to trim the family budget and make ends meet, like so many of my neighbors in our working-class ‘hood,’ focus on cutting my transportation costs. And the more I try, the angrier I get. Angry at the oil companies. Angry that our lives revolve around petro-chemicals. Angry that our leaders just don’t seem to care.
As of Friday, April 4, the cost of regular-grade unleaded gasoline across the entire United States was up above the $3 mark. Another record high – again! Gas prices have gone up 22 percent since this same time last year. Those who need diesel to get around – most of the long-haul truckers that carry our goods around the nation, are paying more than $4 a gallon. The truckers talked of doing a one-day work stall – a strike, if you will – to get the message across that they can’t take any more. But the independent truckers and unions are not the force they once were in this country. The big corporate trucking lines shut down any kind of work protest.
However, despite the increase in costs, Americans’ demand for gas has only decreased by 1.9 percent since last year, according to a report released by Bloomberg.com on the same day gas hit its new record high price.
So the demand shows that some folks, like me are making some adjustments to the gas we consume. But for the most part we are not.
Instead we are continuing to line the pockets of oil company executives. It comes as no surprise that as the gas prices continue to climb to record levels, so does the oil companies’ profits. Not only are their profits record level for oil companies, they are record profits for any industry or company ever in American history.
The San Francisco Chronicle reported last month that Chevron Corp.’s annual profit was $18.7 billion in 2007, the fourth consecutive year that the San Ramon company made record amounts of money. But Chevron is the poorest of the oil companies. Can you imagine, being poor with $18.7 billion in the black? Exxon Mobil, the country’s largest oil company, reported in February that its 2007 profit hit $40.6 billion, a 3 percent increase from 2006, while its sales passed $404 billion. No U.S. company has ever reported a higher profit. In fact all the world’s oil companies have been making record profits since 2005.
Since 2005, several attempts to investigate the huge profits by Congress, including a hearing that occurred on most fittingly, April Fool’s Day. Could it be a fool’s inquiry? Rep. Edward Markey, D-Mass., thinks so. Noting the date of the hearing, he said, “The biggest joke of all is being played on the American families by Big Oil.”
Seriously, they are posting record profits while still gladly accepting federal subsidies, the amount of which equals Chevron’s profits for last year. But, Shell Oil Co. President John Hofmeister admitted at the hearing, reading from a prepared statement, “these costs increases are hitting consumers hard.” Regardless he and the other Big Oil execs from Exxon Mobil, BP America, Chevron and ConocoPhillips deflected blame or the idea that their profits are extreme, saying the $123 billion the companies shared in profits last year were in line with other industries. Yeah, right. Tell that to Ford Motor Company. Or Boeing. Or Mattel.
So while oil companies were telling Congress this week, “Don’t blame us,” (a mantra they seem to have mimicked from the country’s mortgage brokers) the U.S. Labor Department reported another 50,000 added to the American Jobless Rate.
It’s clear the economy is in a pickle. And the entity tipping the scales is the oil companies.
What are our leaders doing about this?
The House last year and again on Feb. 27 approved legislation that would have ended the tax breaks for the oil giants, while using the revenue to support wind, solar and other renewable fuels and incentives for energy conservation. But, the measure has not passed the Senate. Check the financial portfolios of many of the senators. Oil profits are good for them.
Legislation was also recently passed to increase the requirement that vehicles have 35 miles per gallon. But bill concessions were given in order for President Bush to sign the bill (tax breaks for oil companies). Oh, so that’s how I cut my tax bill down? Make $123 billion in profits! Other compromises given were to strip out tax provisions for renewable energy requirements and eliminate incentives for plug-in hybrid vehicles. So, basically signing us into further dependence on oil to get in our cars and commute 40 miles to work so that our 3.3 percent salary increase we averaged last year goes right down the gas tank. Yeah, that works.
Additionally, Congress pushed through the band-aid effort economic stimulus package, which many families will probably spend on ‘haves’ instead of ‘wants’ because the cost of the ‘have to’s’ have skyrocketed to a point that many are living above their capabilities. If we’re smart we’ll all put it into savings or pay off debt. But we’ll probably be putting it into our gas tanks, because many Americans won’t be able to afford the new 35+ mpg cars and will still be driving our 10-year-old gas guzzlers.
This is where I would get to the punch line, where I would direct you, the good old American consumer, where to go and vote with your dollars. But there’s no easy solution here. I’d invite you to write your elected representatives. I’d invite you to protest – ala the aborted truckers’ strike. I’d invite you to do just about anything, as long as it was something. But, this is a situation that’s going to hit our pocketbooks harder and harder and will require phenomenal momentum in order to affect change.
The bottom line is that despite legislation, despite impotent economic stimulus packages, if the oil companies continue to rape the American people – the entire world for that matter – the current situation will only get worse.
April 8th, 2008 at 10:35 AM
April 8th, 2008 at 10:32 PM
April 9th, 2008 at 09:18 AM
April 9th, 2008 at 09:20 AM