Obama and others are wrong on this one:
Democratic presidential candidate Barack Obama’s proposal for a windfall profits tax on oil companies could cost $15 billion a year at last year’s profit levels, a campaign adviser said.
The plan would target profit from the biggest oil companies by taxing each barrel of oil costing more than $80, according to a fact sheet on the proposal. The tax would help pay for a $1,000 tax cut for working families, an expansion of the earned- income tax credit and assistance for people who can’t afford their energy bills.
“The profits right now are so remarkable that one could trim them 10 percent or so, which would turn out to be somewhere in the $15 billion range,” said Jason Grumet, an adviser to the Obama campaign.
I simply oppose the notion that the government should be in the business of deciding how much profit is “too much” (or, for that matter, what is too “little”- see farm subsidies). In addition, unless someone can explain to me how I am wrong, I fail to see how a tax on the price of oil over a certain price won’t simply be passed on to consumers anyway.
If you think large corporations are receiving too much federal largesse in the way of tax breaks, or if you think the corporate tax structure is not adequate, or if you think there are too many corporate loopholes, or any of the above, fine. Fix the tax code (even though even that is still passed on to consumers in the end).
Or, better yet, spur investment in alternative sources of energy, and fewer people will feel the need to buy gasoline, thus reducing their profits. There are lots of courses of action, but I really, really detest this notion that the government should be in the business of deciding who makes too much profit. It may be a politically popular position right now, but that doesn’t make it right. Obama should knock it off.