Tuesday, 08 November 2011 12:59

The Benefits of America's Big Oil Industry

Crude oil and natural gas producers in the USA employ nine million people. Additional millions of shareholders are part of what is called "big oil," part of its profits for sure. Close to half the US population holds stock in oil and natural gas companies. This happens because of the 145 million retirement accounts that are invested in crude oil and gas corporations. Through your pension funds, you're most likely a part of big oil! 

"The average value of these pension accounts is less than $55,000. 48.6 million American families hold IRAs that are invested in oil and natural gas companies—80 percent of these IRA holders earn $70,000 or less. All in all, corporate management owns 2.8 percent of oil companies; middle class Americans largely own the rest."
 

However, the most interesting and active aspect of big oil is to extract and deliver domestic (or Canadian) crude to refineries in Oklahoma and Texas. Oil independence from the troubled Middle East imports is essential to keep up a healthy economy.   

"The pending Keystone Pipeline XL—an oil pipeline that would deliver crude oil from Canada to refiners in Oklahoma and Texas—is a great case study. Providing an immediate boon to the struggling Midwest, the project is slated to cost about $12 billion dollars and would create 13,000 construction jobs. Just as important is the ripple effect the Keystone pipeline would have on the larger American economy. The Keystone pipeline would create over 340,000 additional U.S. jobs between 2011 and 2015 in related manufacturing and service industries."

On the long run, 530,000 new jobs will be created by 2025 in the natural gas and oil resources domestic industry. Government agencies, excessively empowered by the Obama administration, are blocking these jobs. 

Huge profits, in the oil industry, come along with huge expenses and incredible investments. 

"Paying nearly $100 million a day in income taxes, the oil and natural gas industry’s tax expenses average 48 percent, compared to 28 percent for other S&P Industrial companies."

It is useless to mention that the oil industry doesn't receive incentives from the taxpayers money, the way green energy trial-and-error companies do. The alternative energy experiments, in the name of some ghostly scare crow, struggle to keep their business afloat by grabbing government grants -- funds diverted towards these questionable projects from the taxpayer.

Further over-taxing the efficient industries only to pay for deficitary industrial startups is not the way to a cleaner, healthier and more prosperous environment. 

Source: When oil companies make billions, who profits?

 

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