Posted on 08/04/2008 6:11:15 AM PDT by K-oneTexas
What Is a 'Windfall' Profit?
August 4, 2008; Page A12
The "windfall profits" tax is back, with Barack Obama stumping again to apply it to a handful of big oil companies. Which raises a few questions: What is a "windfall" profit anyway? How does it differ from your everyday, run of the mill profit? Is it some absolute number, a matter of return on equity or sales -- or does it merely depend on who earns it?
It's what politicians do in Venezuela, not in a free country.
(Excerpt) Read more at online.wsj.com ...
A windfall profit is the money made by a woodcutter that has the equipment, knowledge and happens to be in a place that needs his expertise and labor to get things back to normal. How the term "windfall profit" ever turned into something bad is a mystery.
Windfall profit = More Money for the Gov’t to extort from the people.
1464, from wind (n.) + fall. Originally literal, in ref. to wood or fruit blown down by the wind, and thus free to all. Fig. sense of “unexpected acquisition” is recorded from 1542.
Online Etymology Dictionary, © 2001 Douglas Harper
It boggles the mind that politicians bemoan windfall profits when they raise taxes for any reason whenever they can.
I thought that was "gleening"?
With that definition in mind, I would like to know how oil produced from an area which has been :
Geologically researched,
(title searched to lease for seismic surveys)
seismically surveyed
Geophysically researched
(again title searched to lease for drilling/production)
leased
Drilled, often resulting in information, but no oil
and finally,
drilled, fracked, put on line, and developed
is in any way a “windfall”
If it is, it takes anywhere from five to ten years to hit the ground.
If McCain was smart he would say that he wants to put a “windfall profits tax” on the Federal govt. and promote tax cuts.
Great post. Just finished reading in my WSJ. It reiterates what many here on FR have been posting for quite some time
The recipients of the taxes realized windfall profits.
This was a good article. WSJ has many good articles. I just wish you could post the entire article (WSJOnline) instead of excerpting.
windfall profits tax, the definition is simple.
What’s yours is theirs. See how simple socialism is.
Good read. The numbers may scare some people off.
A windfall profit is a profit made after Hurricane Katrina, and Uncle Sugar came to town with piles of cash for newly formed companies with political connections.
The other point that is regularly ignored about these oil company “profits”, is that a big piece is being paid to shareholders, who are not only private citizens, but also their IRAs, Mutual Funds, and private investment portfolios.
That money is a far better economic stimulus than anything the Government will come up with.
Great read!
What Obama is proposing will never happen. Oil Companies hire legions of tax attorneys that will be EASILY able to avoid any corporate “takings”.
Not to mention Obama’s proposal is absurd - stealing profits from corporations?? WOW
” excess profits tax
The Columbia Encyclopedia, Sixth Edition | Date: 2008
excess profits tax levy on any profit above a standard level. Chiefly a wartime phenomenon, it is intended to increase revenue during periods of distress and to prevent businessmen from taking unfair advantage of the increased government spending and consumer demand that normally accompany wars. In 1917 the U.S. federal government adopted such a tax, which continued in various forms and at increasing rates until 1921. It was revived by federal legislation during World War II and during the Korean War. The tax was imposed on the excess over a firm’s peacetime earnings or over an arbitrarily decreed earning rate. Great Britain levied an excess profits tax from 1915 to 1921, with a rate varying from 40% to 80%. During the era of World War II, Britain’s excess profits tax was revived, with tax rates increased to 100%. Critics contend that such levies discourage productive enterprise by eliminating the profit motive. “
This is a very good article.... I made the point sometime ago on this forum that liberal favorite companies have higher profit margins than oil companies. That is why the libs go after the sure volume of oil profit dollars. The solution to the liberal angst is to allow more drilling which will reduced oil costs thusly bringing down the profit in dollars. That will make everyone happy.
Has anybody else noticed the freaky similarities between Hugo Chavez' campaign that finally brought him to office, and Baraq's?
Windfall profits taxes have several purposes. The primary purpose is to scapegoat an industry. The rats can brag to the public that they are fighting the forces of evil and greed. Beyond the public relations effect, windfall profits tax is another step towards nationalizing the energy industry. The rats want high energy prices to push their Utopian energy vision. A windfall profits tax will lead to lower production and higher energy prices. The rats will give the oil companies an alternative: pay the tax or commit resources according to rat priorities. The windfall profits tax becomes another subsidy to alternative energy.
Aside from the destructive energy policy that the tax promotes, the tax will be unconstitutional if it is targeted specifically towards several companies. The rats have to tread lightly to avoid the tax being ruled unconstitutional. After the rats pack the court, the court ruling will not be a concern.
Welcome to rat nation. Your energy, health care, home ownership, student loan, compensation, child care, retirement, job security, air, water, food, and transportation are ensured by rat politicians. If you are a conservative, you can certainly live with less consumption because you are taking from the rat masses.
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