Oil firms make ‘more money than God’
President Joe Biden
August 1965 Andrews, TX High School Football Stadium
We had moved from Kermit, a relatively modest West Texas oilfield town, to Andrews, an example of what a town could become with oil revenue wisely invested. Andrews celebrated its billionth barrel of oil production. The Oak Ridge Boys were on hand, then transitioning from a gospel to country group. Barbeque was plentiful and a joyful noise was all around. Andrews used its oil revenue to invest in a Texas first. The only all brick, air-conditioned, carpeted high school with an indoor swimming pool no less. Teachers are paid best in state wages. Amoco and Exxon had first class office buildings where employees could be trained via the vertical integration of the companies. Social mood was peaking as the Dow Industrials topped 1,000 for the first time ever in 1966. Life was good.
Fast forward to 1982 The Carter administration, frustrated with the second Arab oil embargo passed a first ever Windfall Profits Tax. Amoco abandoned its office building and the twenty some odd foreman and the $2-4 million purchase order book they used. Exxon followed, adios good-bye. The good paying jobs vanished. Oil production shifted to far weaker hands. All Carter had to do was wait. By 1986 oil had fallen from $36 to $12 as the Boom became a Bust. The only profit center in West Texas by that time was U-Haul.
Team Biden believes in negative re-enforcement. Like Hugo Chavez, Joe Biden thinks he can remake what is left of our capitalist economy by edict and order. Give those profits back to consumers, never mind shareholders. Those are the same shareholders who weathered Exxon and Chevron stock prices plummeting amid billion dollar losses during COVID. Sorry no thanks from Joe for that! He promises to renew the Strategic Reserve as soon as prices fall to $70. Well if that is his forecast what is the rush to tax?
All Democrat solutions involve a new tax. Here we go again.
And the SEC and Public Accounting Oversight Board are piling on regulations and fines. There is no lack of poor bank and accounting firm behavior but the fines so far have been ineffective. In September 2020 JPMorgan Chase paid a $900 million fine for placing fake trades in the gold futures market. The DOJ says this went on for ten years, wow some oversight there DOJ. A few traders got some time in jail. Well how about kicking Chase out of the gold futures business for a few years. How about blocking Jamie Dimon (annual salary around $26M) out of the banking business?
Team Biden is not encouraging energy independence within the U.S. Team Biden continues to court some of the worst player like Venezuela, anger the Saudis, cuddle up to Iran, and wave goodbye to self-sufficient energy which supports everything else from manufacturing to road building to transportation.
The election is next Tuesday, be sure to vote.
