The Real Windfall Profit

Windfall is defined by investorwords.com as

money received which was not expected and not a direct result of something the recipient did.

We have all heard the rhetoric from the liberals about the windfall profits that the oil companies are making right now that should be taxed.

Based on the definition of "windfall," the real culprit of high gas prices is the government. The oil companies, on average, make about 9 cents of profit per gallon of gasoline sold in the United States. This 9 cents is re-invested into the company to produce better products, explore alternative energy sources, and produce divedends for the shareholders. This after the corporation pays their workers, pumps the oil from the ground, refines the oil into gasoline, and ships it around the country to consumers. This profit is well earned.

How is this profit and job creation rewarded? The oil companies are taxed heavily to subsidize failing alternative energy supplies. If the subsidies from the government ended, the alternative energy sources would end, too. The oil companies paid more in taxes in the last fiscal year than they made in profits. But, that is not even the full story.

The government also makes 43 cents profit off of every gallon of gasoline sold in Texas. Not only is the oil company punished for producing their product, but consumers are also taxed for purchasing the product. The government, which does not produce any energy or oil, makes 4.5 times more profit off of a gallon of gasoline (not counting corporate income taxes) than the oil companies.

This stat is astounding! The liberals, who claim that the meager 9 cents of profit that oil companies make a sale of $3.80, is not fairly earned by the corporation that does all the work to get the product to the market. At the same time, the 43 cents of profit that the government makes on every $3.80 is not scrutinized at all by the taxpayers.

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