Monday, May 23, 2011

Lowering the price at the pump

Gas prices have begun to drop, at least in my neck of the woods, so we will hear less and less demagoguery from Washington over Big Oil's "obscene" profits and what government needs to do about them but I wanted to ask one question while the issue was still fresh in people's minds.

If the goal is to lower the price a the pump then how will raising the amount of taxes which the oil companies must pay (and thus increasing their cost of doing business) help?

I mean that businesses don't really pay any taxes.  Taxes are a cost just like labor and materials and the power, water and phone bills.  Companies pass those costs through to their customers.  That means that part of the purchase price you pay for a television or a car or a Quarter Pounder meal at McDonald's reflects the corporate taxes paid not only by the retailer you made the purchase from, but also all the taxes paid by vendors who sold something to the retailer.

In the case of the Quarter Pounder it includes the taxes paid by the cattle feeder who raised the beef and the wheat farmer who grew the raw material for the bun.  Along with the farmers who grew the onions and cucumbers that became the pickles and the tomatoes which were processed into ketchup.  Then the slaughterhouse and the flour mill and the bakery and that doesn't take into account the potatoes and the packaging materials and the trucking companies that delivered all the various components to the places of processing.  And the taxes of the people who did the processing.

So I ask any leftist who might stop by here, is your blind stupid hatred of "Big Oil" so great that you will be willing to pay more for gas and for any product that requires petroleum based fuel in its production or distribution just so you can "stick it to them"?