Why do people complain about oil company profits?

Question

With all of the complaints about the record profits of the big oil companies, why aren't people investing money in the stocks? Why do they want to punish the companies by taxing them for doing well? Don't these people, some of whom have IRA's and 401K's and stocks and mutual funds, realize that they are only punishing themselves by hurting profits which eventually has a trickle-down effect on the economy?

With all of the complaints about the record profits of the big oil companies, why aren't people investing money in the stocks? Why do they want to punish the companies by taxing them for doing well? Don't these people, some of whom have IRA's and 401K's and stocks and mutual funds, realize that they are only punishing themselves by hurting profits which eventually has a trickle-down effect on the economy?

In response to a couple responses, if you invested more of your money in these companies you would have more money to spend on gas. Yes the company does create new jobs via exploration, research, and so on. Complaining about profits of oil companies is like complaining about food distributors who make record profits when food prices go higher. Get with the program people. If you had invested when the prices were low you would be making a killing like I am.

Answer 1

The ones who realize what you are saying aren't complaining. I may not like gas prices but if I could somehow make money off people as easily as they do I'm sure I would do the same thing.

Answer 2

Because the economy (and life) don't work that way.

"Trickle down" is essentially a myth; it never happens. That's why we have high gasoline prices in the first place.

When a company starts making more money because of a change in it's supply, what does it do:
A - Sell its product for less to pass on the savings to consumers
B - Rake in the profits

The answer actually depends on how elastic the demand is for the product, and other related things.
In an instance like this, when the demand is very inelastic - people will keep buying gas even if the price goes up - the answer is B.

After all, what do you think they're going to do? Get sick of money, and let us have some? Hardly. They're going to do what all companies try to do - profit as much as possible. If people will keep buying gas, the oil companies will just keep the profits, rather than lowering the price.

The only time they're going to lower the price is if demand actually goes down; the other option, that they could make more money by lowering the price, isn't reasonable, because everyone who can buy gas or needs to buy gas already does so as much as possible. The demand simply can't get much higher.

As for investing, you're right, investing in oil isn't a bad idea.
But most americans can't invest; they don't have the money, the know-how, the money to get the know-how, or all three. The number of people who make a lot of money through investing in buisnesses comprises a very small segment of the population. Most people simply don't benefit from it, because they can't. They don't have enough disposable income available to them.

In the mean-time, the oil companies have us by the balls (so to speak), and are squeezing every penny out of us that they can. Which isn't bad, per se - that's what companies always do.

What it means is that government should step up regulation of the industry; the oil companies are making so much money that there's plenty of room to forcibly lower the prices without a lot of negative economic side effects.

But the government is, essentially, owned by the oil companies; they contribute a lot of money to a lot of campaigns.

So that's why people are mad. High prices, and no one is doing anything about it - not even the people who *should* be doing something about it (congress).

Answer 3

When corporations get that big they have use the court system more, and they use roads and water more and want to be protected by police and fire more. When oil companies stay at 80% production instead of raising to 90% like they do in the summer because analyst said the American people might drive less this summer and profit will be lost are no longer serving the people which is the corporations duty. Just another example why corporation are not people and should not have the same rights as people.

Answer 4

The OIL industry is only ONE segment of the economy, other parts of the economy like airline tourism, manufacturing, construction, and agriculture have all taken huge dollar losses in the billions. These industries have had to cut tens of thousands of jobs and have to raise prices on goods and services.
There is a widespread belief that big oil companies
have a monopoly on crude oil production and refineries.
Even though a windfall tax may not solve the problem of high energy prices, it could go into alternative energy research and improving transportation infrastructure, so that oil consumption can be reduced.

Big Oil is making billions at the expense of the global economy.
Is it worth the price of super inflation and rising unemployment ?

Answer 5

The way the money moves around is erratic and unjust. That's why people complain. Your reasons are valid, but your initial question was about the complaints.

Your questions clearly reflect your perspective, which celebrates the oil oligopolists. You have reasons for your celebration, but they are not insightful when considering "most people".

Just an example, some people prefer to invest in other things like local real estate, start-up companies, or small businesses. These locally beneficial investment opportunities are crowded out by the oil company investment binge, which is erratic and unpredictable.

So there. That's why.

Answer 6

not a whole lot of people have money to invest in oil. I'm not sure how much Exxon's stock is going for but I'd imagine it's not cheap for one (1) share. I know when i get my paycheck the last thing i think about is investing in some oil company -- i worry about how I'm going to manage filling my car with gas, paying my mortgage and buying groceries that week. it would be nice to have a few hundred or thousand to invest in the same companies that are increasingly worrying my finances.

Answer 7

one of the many reasons their profits anger me is because they as corporations are taxed by our goverment at a lower rate than an average working person. also, when the president gives "us" tax cuts, these same companies get a higher rate than the average person. then we have the war. if our goverment placed higher restrictions for importing oil into this country and at the same time gave incentives to companies that researched and developed new energy sources that would rid us of our dependancy on oil, then not only could we bring our soilders home (where maybe they could help to rebuild the south), but it might also drastically curb the negative effects that oil comsumption has on the worlds environment. and finally, does anyone really need to earn a 400 million dollar pension? (and how much of that do you honestly think is going to trickle into your pocket.)

Answer 8

Because we goto war to countries which are big oil producers.

Oil gets pumped out dirt cheap from these countries via government occupation, barrel prices are high, oil companies make record profits.

Bush's family owns Shell and Amico Oil groups, they're huge in oil.

They went to war for their own interests, and made huge profits more than ever before, all because of a war killing thousands of innocents to get oil and get rich.

Talk about fscked up american foreign policy.

And oil prices?

The american oil reserve is full, if bush was to open it up the market prices would drop, but bush doesn't want to make the prices drop because he's happy he's making money.

PSSSH.

The us government and the oil industry are the biggest crimes of the 21st century.

Answer 9

People complain about oil profits because they buy into the EVIL OIL COMPANY garbage (and all the conspiracy theories surrounding that and any president..), because they don't understand economics, taxation (which punishes the oil companies as much as anyone), etc.

Basically, because they're extremely ignorant.

One look at this page proves that point right off.

Answer 10

I think the general (conscious) complain of the oil companies is that they aren't changing their business objectives to become energy companies (with the profits that they are taking in)

becoming energy companies rather than oil and coal companies is too greedy with no sense of social responsibility...

there comes a point when no mater how much someone pays me I won't work for them...

its just a matter of where we draw that line :)