Dems propose 'Reasonable Profits Board' to regulate oil company profits

[CrusaderFrank]

Dems propose 'Reasonable Profits Board' to regulate oil company profits - The Hill's Floor Action

Dems propose 'Reasonable Profits Board' to regulate oil company profits
By Pete Kasperowicz - 01/19/12 10:20 AM ET

Six House Democrats, led by Rep. Dennis Kucinich (D-Ohio), want to set up a "Reasonable Profits Board" to control gas profits.

The Democrats, worried about higher gas prices, want to set up a board that would apply a "windfall profit tax" as high as 100 percent on the sale of oil and gas, according to their legislation. The bill provides no specific guidance for how the board would determine what constitutes a reasonable profit.

The Gas Price Spike Act, H.R. 3784, would apply a windfall tax on the sale of oil and gas that ranges from 50 percent to 100 percent on all surplus earnings exceeding "a reasonable profit." It would set up a Reasonable Profits Board made up of three presidential nominees that will serve three-year terms. Unlike other bills setting up advisory boards, the Reasonable Profits Board would not be made up of any nominees from Congress.

The bill would also seem to exclude industry representatives from the board, as it says members "shall have no financial interests in any of the businesses for which reasonable profits are determined by the Board."

According to the bill, a windfall tax of 50 percent would be applied when the sale of oil or gas leads to a profit of between 100 percent and 102 percent of a reasonable profit. The windfall tax would jump to 75 percent when the profit is between 102 and 105 percent of a reasonable profit, and above that, the windfall tax would be 100 percent. The bill also specifies that the oil-and-gas companies, as the seller, would have to pay this tax.

Kucinich said these tax revenues would be used to fund alternative transportation programs when oil-and-gas prices spike.

"Gas prices continue to rise, creating a hardship for the American people," he said. "At the same time, oil companies are making record profits gouging their customers. This bill would tax only the excess profits and create forward-thinking transportation alternatives."

Specifically, he said the money would be used to fund a tax credit on the purchase of fuel-efficient cars and set up a grant program for mass transit programs when oil-and-gas prices are high.

The bill does not estimate the size of these grants or the amount of money that might be collected through the tax.

Co-sponsoring the bill are five other Democrats: Reps. John Conyers Jr. (Mich.), Bob Filner (Calif.), Marcia Fudge (Ohio), Jim Langevin (R.I.), and Lynn Woolsey (Calif.)

American Dems are economically to the left of real Communists and keep moving further left

 

[Katzndogz]

Oh come on. Don't worry. Oil companies aren't going to give up their profits. What they will do, is make what they can, and when they reach the ceiling, the will just stop selling it!

Or, just get the fuck out of this country completely which is more likely.

 

[Soggy in NOLA]

Nah, they're not Marxists... not at all.

 

[Soggy in NOLA]

Led by Dennis Kucinich! You know this isn't going to go anywhere.

Figures.. Kucinich is in a dead heat with Maxine Waters for the moonbat crazy crown.

 

[Conservative]

Did anyone proposing this actually DO the math?

According to the bill, a windfall tax of 50 percent would be applied when the sale of oil or gas leads to a profit of between 100 percent and 102 percent of a reasonable profit. The windfall tax would jump to 75 percent when the profit is between 102 and 105 percent of a reasonable profit, and above that, the windfall tax would be 100 percent. The bill also specifies that the oil-and-gas companies, as the seller, would have to pay this tax.

Theoretically, let's say they determine a 'reasonable profit is $50.00.

If a sale nets $50.00 in profit, which is already determined to be 'reasonable', the tax would be $25.00 (assuming they are taxing the profit and not the entire sale price... that was not made clear in the OP), reducing said 'reasonable profit' to $25.00.

If a sale nets $51.50, 3% over the 'reasonable profit', the tax would be $38.63, reducing said profit to $12.87.

If a sale were to net $53.00, 6% over the 'reasonable profit', the tax goes to 100%, meaning there IS no profit.


Are they on crack?

I think the tax is 50 percent on all profits up to 100 percent. Then those profits that are above 100 percent and less than 106 percent will be taxed at 75 percent. All profits above 105 percent will be taken.

I see. That would change obviously my 2nd and 3rd numbers, but not the 1st. Thanks.

 

[g5000]

Speaking of math, the term "reasonable profits" is about as marxist as it gets. But I would not expect anything less from Nikita Kruschinich.

So let's say Karl Marx of the Potomac decides a "reasonable profit" for a company like Exxon is $10 billion.

Let me demonstrate the problem when you fix a number like that.

Imagine you are a widget maker. Your widget revenues are $10. It costs you $9.50 dollars in parts, labor, and other operating costs to make a widget. So your net profit is $0.50, or five percent.

Let's say you sell a billion widgets a year. That means you make $500,000,000 profit a year.

Over time, inflation caused by the Fed printing money causes the cost of your parts to rise. The labor unions started demanding more money and a Cadillac health plan, so your labor costs are up, too.

Now your operating costs are $12.00.

To continue to make a five percent profit you now have to charge $12.60 for a widget.

If you sell a billion widgets, your profit is now $600,000,000.

The People's Paper has a screaming headline: "Capitalist Pig Makes Record Profits!!!!!"

The Dialectic Materialist of Democracy then passes a law that you cannot be allowed to make a profit of more than $600,000,000 from now on.


When your operating costs rise to $15.00, you can no longer make a five percent profit. Because that would mean you would charge $15.75 a widget, netting $750,000,000 in profits. You would be in violation of the simpering commies' law.

So you must charge $15.60 a widget.

The marxists celebrate that their comrades in Congress saved them money.

But now your margin is down to four percent.

And with each passing year as your operating costs continue to rise, that profit margin gets thinner and thinner until it vanishes.

Then you stop making widgets.

 

[imbalance]

Nah, they're not Marxists... not at all.

I don't know if it's as much Marxism as it is opportunism. Being a legislator who gets to determine how much $ oil companies are allowed to make places the legislator in quite a lucrative position.

 

[gallantwarrior]

Dems propose 'Reasonable Profits Board' to regulate oil company profits - The Hill's Floor Action

Dems propose 'Reasonable Profits Board' to regulate oil company profits
By Pete Kasperowicz - 01/19/12 10:20 AM ET

Six House Democrats, led by Rep. Dennis Kucinich (D-Ohio), want to set up a "Reasonable Profits Board" to control gas profits.

The Democrats, worried about higher gas prices, want to set up a board that would apply a "windfall profit tax" as high as 100 percent on the sale of oil and gas, according to their legislation. The bill provides no specific guidance for how the board would determine what constitutes a reasonable profit.

The Gas Price Spike Act, H.R. 3784, would apply a windfall tax on the sale of oil and gas that ranges from 50 percent to 100 percent on all surplus earnings exceeding "a reasonable profit." It would set up a Reasonable Profits Board made up of three presidential nominees that will serve three-year terms. Unlike other bills setting up advisory boards, the Reasonable Profits Board would not be made up of any nominees from Congress.

The bill would also seem to exclude industry representatives from the board, as it says members "shall have no financial interests in any of the businesses for which reasonable profits are determined by the Board."

According to the bill, a windfall tax of 50 percent would be applied when the sale of oil or gas leads to a profit of between 100 percent and 102 percent of a reasonable profit. The windfall tax would jump to 75 percent when the profit is between 102 and 105 percent of a reasonable profit, and above that, the windfall tax would be 100 percent. The bill also specifies that the oil-and-gas companies, as the seller, would have to pay this tax.

Kucinich said these tax revenues would be used to fund alternative transportation programs when oil-and-gas prices spike.

"Gas prices continue to rise, creating a hardship for the American people," he said. "At the same time, oil companies are making record profits gouging their customers. This bill would tax only the excess profits and create forward-thinking transportation alternatives."

Specifically, he said the money would be used to fund a tax credit on the purchase of fuel-efficient cars and set up a grant program for mass transit programs when oil-and-gas prices are high.

The bill does not estimate the size of these grants or the amount of money that might be collected through the tax.

Co-sponsoring the bill are five other Democrats: Reps. John Conyers Jr. (Mich.), Bob Filner (Calif.), Marcia Fudge (Ohio), Jim Langevin (R.I.), and Lynn Woolsey (Calif.)

Democrats can kiss our collective ass.

Do they even understand the concept of liberty?

Apparently not.

 

[g5000]

Nah, they're not Marxists... not at all.

I don't know if it's as much Marxism as it is opportunism.

No. It is price fixing. Pure and simple price fixing.

 

[LordBrownTrout]

Speaking of math, the term "reasonable profits" is about as marxist as it gets. But I would not expect anything less from Nikita Kruschinich.

So let's say Karl Marx of the Potomac decides a "reasonable profit" for a company like Exxon is $10 billion.

Let me demonstrate the problem when you fix a number like that.

Imagine you are a widget maker. Your widget revenues are $10. It costs you $9.50 dollars in parts, labor, and other operating costs to make a widget. So your net profit is $0.50, or five percent.

Let's say you sell a billion widgets a year. That means you make $500,000,000 profit a year.

Over time, inflation caused by the Fed printing money causes the cost of your parts to rise. The labor unions started demanding more money and a Cadillac health plan, so your labor costs are up, to

Now your operating costs are $12.00.

To continue to make a five percent profit you now have to charge $12.60 for a widget.

If you sell a billion widgets, your profit is now $600,000,000.

The People's Paper has a screaming headline: "Capitalist Pig Makes Record Profits!!!!!"

The Dialectic Materialist of Democracy then passes a law that you cannot be allowed to make a profit of more than $600,000,000 from now on.


When your operating costs rise to $15.00, you can no longer make a five percent profit. Because that would mean you would charge $15.75 a widget, netting $750,000,000 in profits. You would be in violation of the simpering commies' law.

So you must charge $15.60 a widget.

The marxists celebrate that their comrades in Congress saved them money.




But now your margin is down to four percent.

And with each passing year as your operating costs continue to rise, that profit margin gets thinner and thinner until it vanishes.

Then you stop making widgets.

Just remember that more is never enough and you'll be fine.

 

[gallantwarrior]

Did anyone proposing this actually DO the math?

According to the bill, a windfall tax of 50 percent would be applied when the sale of oil or gas leads to a profit of between 100 percent and 102 percent of a reasonable profit. The windfall tax would jump to 75 percent when the profit is between 102 and 105 percent of a reasonable profit, and above that, the windfall tax would be 100 percent. The bill also specifies that the oil-and-gas companies, as the seller, would have to pay this tax.

Theoretically, let's say they determine a 'reasonable profit is $50.00.

If a sale nets $50.00 in profit, which is already determined to be 'reasonable', the tax would be $25.00 (assuming they are taxing the profit and not the entire sale price... that was not made clear in the OP), reducing said 'reasonable profit' to $25.00.

If a sale nets $51.50, 3% over the 'reasonable profit', the tax would be $38.63, reducing said profit to $12.87.

If a sale were to net $53.00, 6% over the 'reasonable profit', the tax goes to 100%, meaning there IS no profit.


Are they on crack?

Quite obviously, yes.

 

[g5000]

Just remember that more is never enough and you'll be fine.

Just remember that when you take away the profit incentive you will live in a cold and dark cave, and you will be fine.

 

[gallantwarrior]

Just remember that more is never enough and you'll be fine.

Just remember that when you take away the profit incentive you will live in a cold and dark cave, and you will be fine.

And you'd better be able to make your own stuff, because nobody else will.

 

[francoHFW]

On the other hand, the people yelling "Marxists" biotch when Big Oil's profits are released...or their 40 billion dollar subsidy is reported. (Same as all the subsidies for alternative energy, which is WORKING)

This won't happen but something should be done- actually Obama is doing it- some intelligent regulation and safeguards- not enough to hurt in a delicate economy- except from the "the sky is falling!! MARXISTS!!" morons...

 

[g5000]

Just remember that more is never enough and you'll be fine.

Just remember that when you take away the profit incentive you will live in a cold and dark cave, and you will be fine.

And you'd better be able to make your own stuff, because nobody else will.

(sent from my iPhone)

 

[gallantwarrior]

Just remember that when you take away the profit incentive you will live in a cold and dark cave, and you will be fine.

And you'd better be able to make your own stuff, because nobody else will.

(sent from my iPhone)

Sorry to disappoint, I don't own an iPad. And I wouldn't miss the internet, either. I have what I need to survive, do you?

 

[g5000]

And you'd better be able to make your own stuff, because nobody else will.

(sent from my iPhone)

Sorry to disappoint, I don't own an iPad. And I wouldn't miss the internet, either. I have what I need to survive, do you?

The marxist utopia: everyone living in a dark, cold cave. Equal in their misery.

 

[Toro]

Dems propose 'Reasonable Profits Board' to regulate oil company profits - The Hill's Floor Action

Dems propose 'Reasonable Profits Board' to regulate oil company profits
By Pete Kasperowicz - 01/19/12 10:20 AM ET

Six House Democrats, led by Rep. Dennis Kucinich (D-Ohio), want to set up a "Reasonable Profits Board" to control gas profits.

The Democrats, worried about higher gas prices, want to set up a board that would apply a "windfall profit tax" as high as 100 percent on the sale of oil and gas, according to their legislation. The bill provides no specific guidance for how the board would determine what constitutes a reasonable profit.

The Gas Price Spike Act, H.R. 3784, would apply a windfall tax on the sale of oil and gas that ranges from 50 percent to 100 percent on all surplus earnings exceeding "a reasonable profit." It would set up a Reasonable Profits Board made up of three presidential nominees that will serve three-year terms. Unlike other bills setting up advisory boards, the Reasonable Profits Board would not be made up of any nominees from Congress.

The bill would also seem to exclude industry representatives from the board, as it says members "shall have no financial interests in any of the businesses for which reasonable profits are determined by the Board."

According to the bill, a windfall tax of 50 percent would be applied when the sale of oil or gas leads to a profit of between 100 percent and 102 percent of a reasonable profit. The windfall tax would jump to 75 percent when the profit is between 102 and 105 percent of a reasonable profit, and above that, the windfall tax would be 100 percent. The bill also specifies that the oil-and-gas companies, as the seller, would have to pay this tax.

Kucinich said these tax revenues would be used to fund alternative transportation programs when oil-and-gas prices spike.

"Gas prices continue to rise, creating a hardship for the American people," he said. "At the same time, oil companies are making record profits gouging their customers. This bill would tax only the excess profits and create forward-thinking transportation alternatives."

Specifically, he said the money would be used to fund a tax credit on the purchase of fuel-efficient cars and set up a grant program for mass transit programs when oil-and-gas prices are high.

The bill does not estimate the size of these grants or the amount of money that might be collected through the tax.

Co-sponsoring the bill are five other Democrats: Reps. John Conyers Jr. (Mich.), Bob Filner (Calif.), Marcia Fudge (Ohio), Jim Langevin (R.I.), and Lynn Woolsey (Calif.)

That's a whole lot of stupid.

 

[Stephanie]

We have got to get this administation and all his comrades in arms in the Democrat party.........GONE this election..

 

[Quantum Windbag]

On the other hand, the people yelling "Marxists" biotch when Big Oil's profits are released...or their 40 billion dollar subsidy is reported. (Same as all the subsidies for alternative energy, which is WORKING)

This won't happen but something should be done- actually Obama is doing it- some intelligent regulation and safeguards- not enough to hurt in a delicate economy- except from the "the sky is falling!! MARXISTS!!" morons...

Please show me any post I ever bitched about the oil company profits.

By the way, I oppose all subsidies, even the ones that I like.