Obama Hood: Taxing Big Oil to Give Americans Another Stimulus Check
Unemployment rates in the United States hit a four-year high in July, and inflation rates have risen 1.32% since January 2008. In fact, economists believe inflation is the greatest threat to the US economy and worry the energy-driven rise in prices will become permanent. Senator Obama’s response to the dire economic outlook is an “Emergency Economic Plan” that would take from rich oil companies experiencing record profits and give back to the American people in the form of stimulus checks, as well as invest $50 billion in states and infrastructure.
Obama’s Emergency Economic Plan
Unlike McCain, who can’t remember the price of gas or how many houses he owns, Obama recognizes working Americans are struggling. In response to the current economic crisis, Obama’s Emergency Economic Plan offers both long and short term solutions. In a move reminiscent of Robin Hood, Obama would take from rich oil companies and give to the American people. The emergency plan also includes a $50 billion stimulus package designed to save 1 million jobs. Specifically, Obama’s plan includes:
- Forcing big oil companies to take a reasonable share of their record breaking windfall profits and use it to help struggling families with direct relief worth $500 for an individual and $1,000 for a married couple. The relief would be delivered as quickly as possible to help families cope with the rising price of gasoline, food and other necessities. The rebates would be fully paid for with five years of a windfall profits tax on record oil company profits. This relief would be a down payment on Obama’s long-term plan to provide middle-class families with at least $1000 per year in permanent tax relief.
- $50 billion in immediate measures to turn our economy around and help prevent more than 1 million Americans from losing their jobs:
- $25 billion in a State Growth Fund to prevent state and local cuts in health, education and housing assistance or counterproductive increases in property taxes, tolls or fees. The fund will also ensure sufficient funding for home heating and weatherization assistance as we move into the fall and winter months.
- $25 billion in a Jobs and Growth Fund to replenish the highway trust fund; prevent cutbacks in road and bridge maintenance and fund new, fast-tracked projects to repair schools – all to save more than 1 million jobs in danger of being cut.
McCain’s Response
McCain would rather help Big Oil than working Americans. Proposing corporate tax cuts and increased drilling won’t feed families. McCain stated:
Across this country, Americans are hurting and today’s job numbers are just the latest reminder of the economic challenges we face. … Unlike Sen. Obama, I do not believe that raising taxes is the answer to our economic problems. There is no surer way to force jobs overseas than to raise taxes on businesses.
Raising taxes on Big Oil when they are making record profits only seems fair in these tight times. Obama is not proposing taxing struggling businesses or working individuals. When wealth is unevenly distributed, I believe it is the right of government to intervene on behalf of working citizens. Remember, these are “windfall” profits Obama proposes taxing; however, what happens to permanent tax relief and the State Growth Fund and Jobs and Growth Fund when windfall profits don’t exist? Perhaps a decrease in military spending could be the solution as we pull out of Iraq.
The Effectiveness of Stimulus Checks
How exactly would a $1000 stimulus check help American families. Obama claims it would:
- Offset the entire increase in gas prices for a working family over the next four months
- Pay for the entire increase in winter heating bills for a typical family in a cold-weather state
The first suggestion is reminiscent of the gas tax holiday proposed by McCain and Clinton that Obama critized as a “short-term quick fix”. Stimulus checks are not a new idea, and I can’t help but wonder if Obama is simply following Bush’s plan that caused a short term boost to the struggling economy this spring to win votes. What did you spend your stimulus check on? I put mine in an IRA, which is probably what I would do with another one. I am learning to live more frugally during these times of high gas prices, and one check won’t go far enough to change that. It is important to remember though, that stimulus checks are only one part, and probably the least significant part, of Obama’s Emergency Economic Plan.
Image: freefoto
“Taking from” Gas companies will only increase the price of gas. Why is that not clear to you guys? You’re an idiot if you think it won’t. The solution is to provide incentives to build our cities in manners that do not REQUIRE cars, then people can get off gas, and cars, on their own and the gas companies will have to change their tune.
Robin Hood? You’ve got to be kidding me.
Obama Hood: Taxing Big Oil to Give to America | politikly.com…
\r\nIn a move reminiscent of Robin Hood, Obama would take from rich oil companies and give to the Am…
sounds like you are a lawyer or doctor or dare i say oilman. at some point we have to penalize the big oil companies for gouging the american public or any other country for that matter. hey i have an idea why don’t we just give the big oil companies a $10 billion dollar a year more tax break. oh wait that’s right mccain already wants to do that. i know maybe i should sign my check right over to the oil companies and let them decide what i should eat and where i should sleep too. our economy is in shambles and you think we should see if 4 more years of the same will help. YOU ARE AN IDIOT. you want to know what i did with my stimulus check? i put it my gas tank and spent it at the local grocery store. i got about $4 dollars in hourly raises about 2 years ago and it is like i am making what i made before the raises. grow up rich guys and see that the poor man is struggling. we need to start with taxing the rich, removing illegal immigrants (about ten thousand at a time), legalize marijuana and tax the hell out of it (no i do not smoke) and last but not least: get the republican rich guys out of office. i could go on and on but it is late and obviously you are rich so i am wasting my time. oh just one more thing. good luck (rich guy)if obama does not get elected trying to get your employees to work with no possible way to get there as they will not be able to afford a car much less gas.
I spent mine on bills and bought some things I’d been putting off due to higher prices at the pump and grocery store.
I think that’s what the vast majority of Americans would do as well, considering how many foreclosure notices are going out every month.
I like the idea of having oil companies share their profits with the rest of us, but I do not see it as a tax.
As the oil companies have worked hard to tell us through many advertising venues, we are their partners. We own their stock and we own many of the resources that they extract from the earth since they are largely on public land. We also provide the service of protecting their safe passage on the ocean when they are brining their products from foreign lands and the service of protecting their supply points like off-shore platforms in the Gulf and off the coast of Nigeria.
As a partner in the endeavor, I feel cheated. Many oil companies are paying only 10-15% of their post tax profits out in dividends, and their royalty payments for extracting resources from publicly owned property are often set at levels that indicate that our representatives at the table were very poor negotiators.
I kind of like Alaska’s system where the residents of the state have apparently negotiated a better partnership with the extraction companies.
When oil prices increase, we should all benefit since we all own a share of the oil that is being pulled from under the ground and many of us - through our pension plans and mutual funds - own portions of the energy companies. We just need to shift the paradigm and negotiate a better share of the profits.
Here is an interesting factoid from ExxonMobil’s 2007 annual report.
Their revenue was $390 Billion, their income tax was $29 Billion. The ratio of income tax to revenue is thus 1:13.4.
My family’s ratio of income tax to revenue was nearly two times higher than that. (about 1:7)
I’m just wondering if Mr. Obama has thought about what those big oil companies will do in order to make back the money he proposes be collected in the form of taxes? Past experience would indicate that they would merely raise prices even higher to offset their tax loss. While I agree that it doesn’t make sense that oil profits have seemed to increase almost exponentially over the last few years while the public is told the cost of gas and byproducts is determined strictly by supply and demand, I just can’t see how raising taxes will ever benefit the average citizen.
[...] climate bill. Not only will Obama create 5 million new jobs in a green economy, he has pledged to give Americans a $500 rebate check funded by a windfall profits taxes on big oil companies. He even plans to put 1 million plug-in-electric hybrid vehicles on the road by 2015 by giving $4 [...]
I think the stimulus plan, totally an astronomical amount of money and giving tax payers, what???? — a one thousand dollar check to pay for their heating bill? I think that makes any republican ‘trickle down’ economic policy look like child’s play. I think this is government becoming the big sponge, scooping up all the free money out there and leaving individuals barely enough to scrap by on. Governemt becomes the main player in the game and we are just the wallet…How this is going to work is beyond any common sense….