Monday, October 31, 2005

The Real Fate of Gasoline Profits

Here's interesting news, via Tax Foundation: Gas taxes paid to the government since 1977 exceeded the profits made by those companies over the same interval. Which means that state and federal coffers made out better than those of the petroleum industry. Where does all that money go? How interested in reducing oil company profits and the price of fuel are those profiting governments?

There has been a lot of buzz about taxing the oil industry in these flush times of astronomical profits. These "windfall tax" proposals are a bad idea. Say the industry tanks sometime in the future. What's to stop the industry from then approaching the government with this proposal: "Hey, you guys levied windfall taxes upon us when profits were way up, now subsidize our industry since profits are way down".

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