More government aid?
After reading an article about the possibility of the Obama administration pushing for a $1000 Emergency Energy Rebate, I had to check it out for myself.
I found that while talk of an “energy rebate” isn’t recent news, the Obama campaign did talk on the campaign trail about giving a check to “American families”.
From Obama’s website, one possible solution to high energy costs would be:
Enact a Windfall Profits Tax to Provide a $1,000 Emergency Energy Rebate to American Families.
Obama and Biden will enact a windfall profits tax on excessive oil company profits to give American families an immediate $1,000 emergency energy rebate to help families pay rising bills. This relief would be a down payment on the Obama-Biden long-term plan to provide middle-class families with at least $1,000 per year in permanent tax relief.
So on top of a possible second stimulus check some people may have another additional $500-1000 check to look forward to to help pay the costs of energy.
My question is this: When did making big profits turn into a bad thing? What exactly is “excessive profits”?
Companies that are actually doing well are being penalized, while companies that had bad business plans and mountains of debt are being bailed out by the government to the tune of billions of dollars. Does that make sense?
So how could the check be used? From Politico:
The first part of Obama’s plan is an emergency energy rebate ($500 to individual workers, $1,000 to families) …
“This rebate will be enough to offset the increased cost of gas for a working family over the next four months,” Obama said. “Or, if you live in a state where it gets very cold in the winter, it will be enough to cover the entire increase in your heating bills. Or you could use the rebate for any of your other bills or even to pay down debt
As nickel says, I’m not sure how this is any different from a stimulus check in the first place, and I’m not sure it’s a great idea. Won’t the oil companies just pass the higher costs (because of “windfall profits taxes”) on to the consumers in the form of higher prices?
At what point do the rebates, stimulus check and freebies end? How are they all going to be paid for? Or are we not worried about how to pay for things, right now – we’ll just keep on printing money until we have enough? Let our kids pay for it?
Will it happen?
Will this proposal for an energy rebate be dead on arrival now that Obama has been elected, and the price of gas has dropped over the past few months? Some think so:
The call for an energy rebate also may lose its urgency as gasoline prices have dropped by more than a third and heating oil by almost half from their peaks last summer.
We shall see!
What do you think?
What do you think about the idea of a $1000 emergency energy rebate? Is it a good idea, or a bad idea? Would it essentially be just another stimulus check?
While I like many of Obama’s economic ideas, the windfall tax on oil companies for an energy rebate is not one of them. Taxing these profits are not helpful, I think, and I didn’t like the first economic stimulus check, either.
However, oil companies are getting subsidies and come very nice tax breaks. I do think that those subsidies and tax breaks should be taken away. Do companies with billions in profits each quarter really need the help of socialized capitalism to keep them going? So — end the subsidies and the special tax breaks, but a windfall tax on profits is excessive.
Mirandas last blog post..Fixing the Economy: “Ordinary” Folks Weigh In
I meant “some” rather than “come” (grins sheepishly)
Mirandas last blog post..Fixing the Economy: “Ordinary” Folks Weigh In
how stupid you just said you liked many of his plans but then you go and say you dont like them.
No, what I said was that even though I like many of Obama’s proposals, I don’t like ALL of them. Just because I like many of his proposals and ideas, doesn’t mean that I have to like everything he has ever said, or will ever say. It’s called critical thinking. Just because something he says resonates with me, doesn’t mean that everything he says will resonate with me, and just because I like three or four things that he is proposing, it doesn’t mean I have to blindly like everything he proposes.
I like his idea of building infrastructure, focusing on building an alternative energy economy and some of his other plans. I like the idea of ending subsidies to Big Oil. But I don’t agree with everything he says, and I think the windfall tax is a bad idea, along with another”stimulus” check to individuals.
See, it is possible to agree with some things that someone says, and disagree with other things that the same person says.
Like Miranda, I go back and forth on the windfall tax, however, I think that oil is as much a necessity as electricity and utility companies are regulated to keep them from taking advantage of the fact that people can’t really live without it. The same pretty much holds true for fuel. It would be hard to just quit buying or using it and so the oil companies can charge whatever they want. 58% increase in profits in today’s economy is pretty obscene. I’m not sure that they should be taxed separately but perhaps (I can’t believe I am saying this) regulated in some way.
The simple fact is that all corporate taxes filter down to the consumer. No matter how you frame it, taxes such as these are bad for everyone and only push inflation.
How can they guarantee that the stimulus check would specifically go towards energy costs? I think the stimulus in any sense could potentially work, but not at how they currently do it. By giving people a check, most people are just going to put it in the bank to help pay some bills. They won’t go out and use it for purchases. They should have a stimulus gift card instead. If there was a 6 month time limit on the card then you would be forced to have to buy something, helping shops and local economies.
Socialism, pure and simple. Let’s just put aside whether or not it’s fair, or oil companies are taking advantage, or the hundreds of other surface issues.
If this is OK, then where do we draw the line? What’s considered “excessive … profits”? The principle behind this is re-distribution of wealth, which is nothing short of socialism! But we should not be surprised. We (the American people) are the idiots who voted a “wealth spreading”, smooth talking, politician into the White House. Now it’s time to start facing the consequences…
Justin “The Night Trader”s last blog post..
I think we all could use some extra cash right now.The goverment and all the greedy people in this world is the reason we as a people need help right now. If The president elect wants to give the people another stimulus check I’m sure you as well as I could you it. I have been struggling a very long time with every thing goig up except the paycheck.I want the check. Sign One tired lady
In response to how Bush intended the first stimulus checks to be used for: My family barely saw any of that Stimulus check because for some reason FICA did not tax us enough during the year and we owed 1100 to them by April… so when stimulus checks came through, 1100 was taken away from us from the start… what are we gonna do with 100 extra dollars in our pockets? PAY A BILL… thats about all it was good for. Of course, I am not and never claim to be an expert in finance and politics and all that jazz, so I am missing the reason to why these checks are a bad thing? I am glad for one that at least we didnt OWE the 1100 dollars because we’d still be paying them 100 bucs a month if not for the stimulus package…
to add… when the first stimulus package came through, i was pregnant with our first child, knowing that i couldnt afford to go back to the job i was at and pay for the expensive childcare… I am now a stay at home mom, living off my hubbys sole paycheck and trying to find work that pays well enough to afford good childcare, or find a real stay-at-home job that isnt a scam. So could I use a stimulus check right about now? YES… Id probably use it towards getting home prepared for a family childcare center tho, not to boost the economy by buying inanimate objects
I have two reasons why there is so much resentment against big oil in the US.
#1 Big oil has a relative monopoly on US consumers. Given the very high cost of entering the oil industry competition is scarce. Thus many believe that big oil is in the business of price fixing to gouge their profits. I few other industries come to mind such as the cable TV and computer software (operating systems) industry.
#2 The US is basically married to big oil because of the dependency factor. Oil and gas affects almost every aspect of American life from plastic water bottles to heating oil. Thus big oil basically has a choke hold on the American economy. This is a tremendous amount of power given to one industry. The fact that the ruling parties allowed this domination feeds the resentment growing in the populous. The big difference between other, so called, monopolies and big oil is the dependency factor. We don’t “need” cable, computers or even cell phones.
i could really use another stimulus check being laid off is really hard. i propose a stimulus check for the money lost due to the gas prices in the past being high. the money helped but many people could hardly buy gas and feed a family. now if we could have money for energy and a food card then things would really pick up.
A Stim. check isn’t going to help stimulate the country out of the recession, but it will help out the hard working american man that work all day and at the end of the week gets a check that is laughable. People who insist that this is socialalism, I say it might be, but don’t we as a country give billion of dollars to wellfare every year! Give money to people that have never worked a day of their life, give money to druggies in rehab! Everyone complains about how dare you tax the wealthy, and I believe you shouldn’t be punished for working hard and be sucessful, but come one how often does a million or billionare look at his companies employees that is busting there butt to make him richer, say to themselves hey joe the plumber is barely making enough to feed his family! You know I could help that guy out and give some of the profit to that guy who makes me all that money.
It is time for the US goverment to take care of the people that keeps the wheels of american turning, that being the working man and not the lazy bums on welfair assistance who never worked a day in there life.