THE US, THE UN AND IRAQ, ELEVENTH THREAD

Submitted by Molly Swartz
August 29th, 2007
Posted in

* An Economy for All

The average compensation of a CEO in 1980 was about 42 times that of the average worker in the company; in 2006, it was more than 364 times.
Source

http://money.cnn.com/2008/04/09/news/economy/incomegap/?postversion=2008040904

As income gap widens, recession fears grow
Incomes fell for poor and stagnated for middle-class families since late 1990s, making it tougher for them to weather economic downturn.

NEW YORK (CNNMoney.com) -- Poor and middle-class families are entering the recession in a precarious situation due in part to declining or stagnant income growth, a study released Wednesday has found.

Incomes, on average, have declined by 2.5% among the bottom fifth of families since the late 1990s, while inching up by just 1.3% for those in the middle fifth of households, according to an analysis by the Center on Budget and Policy Priorities and the Economic Policy Institute, two liberal think tanks.

The wealthiest slice of Americans, however, saw their incomes rise by 9%.

The average income of the bottom fifth of families was $18,116; the middle fifth, $50,434; and the wealthiest fifth, $132,131.

Unlike what happened during the economic boom of the 1990s, lower- and middle-class families did not share in the prosperity of recent years, the report found. In fact, the United States has had its longest jobless recovery and slowest rate of payroll growth during this decade.

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From CBS News (May 3, 2008):

Rich/Poor Income Gap Widening To Chasm
Evidence Shows Impact On Those At Lower End Of Wage Scale Continues To Grow

(CBS) There have always been "haves" and "have-nots" in the United States, but over the past three decades, the gap between them has gotten a lot wider, statistics from congressional numbers crunchers show.

According to the non-partisan Congressional Budget Office, income for the bottom half of American households rose six percent since 1979 but, through 2005, the income of the top one percent skyrocketed - by 228 percent.

And, correspondent Benno Schmidt reported in The Early Show's "Early Wake-Up Call" Saturday, the impact of the growing disparity on the "have-nots," and even on small businesspeople, is being felt more and more.

Schmidt visited Adam Rames who, after 35 years, is saying goodbye to the only way of life he's known - his formerly thriving meatpacking business in New York City.

"I used to feed a lot of families," Rames told Schmidt. "I feel like I took care of the entire East Coast (with meat)!. I used to move 100,000 pounds a week. It's all gone."

Rames says he couldn't pay the rent when it tripled, couldn't pay pensions and retirement for the 15 workers he had to let go, couldn't keep up with gas and fuel prices, and couldn't afford supplies.

"In the past 16 months, I lost 40 percent of my business," he laments.

Now, he's headed for the unemployment line - and he's not alone.

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ican711nm wrote:

When the rich get richer so does the middle class. Wealth is not a fixed quantity such that when some get more others get less. Wealth is increased by all those getting more wealthy--yes, even those on limited incomes get more wealthy and more economic choices as others get more wealthy.

So it will be good for the Iraqis if private oil companies take over the management of Iraqi oil production and refining. Neither the Iraq or American governments are competent to do that job.

As usual Ican; you just talk out of thin air bereft of any facts whatsoever backing you up. Oil companies in these last years have been making record profits but we have not been seeing any benefits from it. Far from it; we have been paying higher and higher prices at the pump. So you're little tried and failed trickle down theory has been a proven failure time and time again for the ordinary people but a success for the oil companies in this instance.

Quote:

15 May 2007
The average price for a gallon of gas in the United States has surpassed the $3.00 mark and is currently at $3.07 per gallon. The sharp rise in gas prices has contributed to record high profits of the major oil companies.

source

That was in 2007 the situation has only increased in both oil company profits and the price at the pumps for consumers. Why would these same companies be any different to Iraqis when they have been sticking to us in the US for years? Answer; they won't be any different.

However that is not the point, the point is that once again we have proof of the administration claiming something that was not true. In this case claiming ignorance of the oil deals being done with people in the administration and are involved in the oil business.

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The fact of the matter is that gasoline prices have increased 600 percent during the past seven years; all thanks to Bush's (incompetent) management of our economy. Most middle-class families lost buying power all during that time, and increased their debt level to the point only one percent is now saving any money. That may have changed to negative territory during the past several months as gas prices shot over $4/gallon.

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The oil companies are making increasing profits because of the increasing price per barrel of the crude oil they buy. When the price of crude oil sold to the oil companies was $20 per barrel, oil company profits per barrel were about 8% of that price or = about 0.08 x $20 per barrel = $1.60. For every billion barrels they bought, their profit was $1.60 x 1 billion = $1.6 billion.

Now that the price per barrel is about $140, oil company profits are about 7 times as much per billion barrels purchased, or 7 x 1.6 billion = $11.2 billion.

If the those envious of oil company profits had any sense, they would encourage more oil drilling and oil lifting in the USA and everywhere else to drive down the current price of crude oil. In particular they would encourage the Democrats to open 2,000 acres of the 19.1 million acres of ANWR to oil drilling and lifting.

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That is more made up numbers by you Ican which is proof of nothing except you are creative with numbers.

The point is that if oil companies do not care that Americans are suffering with these high prices at the pump and make a profit from it at the expense of Americans for whatever reason they cite; they will not be any different to Iraqis. These high prices at the pump are affecting every aspect of our economy while these oil companies are making big bucks from it. They will do the same in Iraq merely because they can.

4 Gas Transforms Buying Habits, Affecting Everything From Vacations to Pizza Orders

They are making these profits at the expense of Americans because they can get away with it and they will be allowed to get away with making all the profits in Iraq while sticking it to the Iraqis as well.

Let's say we develop these drilling places and then we use up that oil. For one thing it will take a long time for the impact of these drilling places to make any impact at all and it won't last forever. And we have no reason to think that even if they did start drilling off shore and at other places the oil companies would not still continue to make record profits and that gas prices will not continue to rise. They do it because they can and they want to make a profit no matter if the whole country has to suffer for it.

Bush Says Dems to Blame for High Gas Prices

I think a compromise should be reached; allow the underdeveloped drilling to go on but put stops on the oil companies making a profit off the suffering of Americans and stops on the rising cost at the pumps for the short term and for the long term good of the economy. Make a law that these companies have to develop other alternatives for oil for when these undeveloped refineries start to run out as well.

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And while the oil companies make big profits, our government gives them billions in subsidies. Go figure.

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Those who oppose others making 7 to 8% profit on their costs for providing others a desired service are mental cripples. The Iraqi people will profit far more from their oil reserves if they contract with private companies than if they depend on government agencies. Private companies have to continue to satisfy their customers to make themselves more profit. Government agencies only have to continue to satisfy themselves to make themselves more power.

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revel wrote:

...
The point is that if oil companies do not care that Americans are suffering with these high prices at the pump and make a profit from it at the expense of Americans for whatever reason they cite; they will not be any different to Iraqis. These high prices at the pump are affecting every aspect of our economy while these oil companies are making big bucks from it. They will do the same in Iraq merely because they can.
...

Gad that 's stupid. Shocked

If the oil companies eliminated their profits on the work they do to bring gasoline to market, the price of gasoline would decrease no more than 8%. So instead of paying $4 per gallon we would be paying $3.68. The oil companies did not cause the price of crude to jump from $20 per barrel to $140 per barrel. That was caused by our government's policy--both Democrat and Republican--to restrict domestic oil drilling and lifting. You and the rest who think like you fell for their scam to blame the oil companies. You and the rest who think like you are the real culprits. You and the rest who think like you are to blame for our suffering, not the oil companies.

By the way, why in hell should the oil companies even bother to supply any gasoline at all if they were to be denied any profit?

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The keyword there is unreasonable profit. The profits the oil companies have been making at the expense of ordinary americans have been obscene. That oil they want to drill will only last a little while and it will and did not have any impact on the gas prices of today. Crude oil went up because of Opec producing less oil for whatever reason. Also there is the theory that speculation and other factors are playing into the record high gas prices.

http://www.bloggingstocks.com/2008/06/11/opec-wants-an-oil-price-solution-from-producer-consumer-meeti/

added

Quote:

Light, sweet crude for August delivery settled at a record $145.29 Thursday on the New York Mercantile Exchange, up $1.72 from the previous day. Earlier in the session, the contract rose to $145.85 a barrel, also a new high.

Oil has set trading or closing records in each of the last six trading sessions.

"Prices that you once would've associated with the lunatic fringe are now mainstream," said Tom Kloza, chief oil analyst at the Oil Price Information Service.

Drivers in about three-quarters of U.S. states are now paying more than $4 for a gallon of gasoline. Nationwide, the average retail price for regular gasoline jumped six-tenths of a penny to $4.098 a gallon, according to AAA, the Oil Prices Information Service and Wright Express.

The latest surge in oil prices was propelled by a midweek report of lower crude stockpiles in the United States, lingering concerns about conflict with Iran and comments by Saudi Arabia's oil minister suggesting his country would not boost production.

Prices might have gone even higher Thursday were it not for a sharp gain by the dollar against the euro. The greenback strengthened considerably after the European Central Bank raised interest rates by a quarter point as expected but did not signal additional rate hikes that might further boost the 15-nation European currency.

"The strength in crude oil is amazing given the price of the euro," said James Cordier, president of Tampa, Fla.-based trading firms Liberty Trading Group and OptionSellers.com.

A slumping dollar has been a key driver pushing oil prices up by half this year. Many investors buy commodities such as oil as a hedge against inflation when the greenback weakens, and a falling dollar makes oil less expensive to investors overseas. When the dollar strengthens, traders typically have less incentive to buy commodities.

Oil prices are also rising because investors have been pumping more money into the commodity to compensate for what are perceived to be anemic returns elsewhere, analysts say. The major stock market indexes are all down by double digits since the start of the year.

Recent saber-rattling in the Middle East is another reason for this week's increase. Traders are concerned that a conflict with Iran could disrupt what are already seen as uncomfortably tight global supplies.

"There's a whole lot of thinking right now that prices haven't risen high enough to meet demand growth," Cordier said.

Speaking Thursday in Madrid, Saudi Arabia's oil minister said the world's biggest oil exporter had no immediate plans to boost crude output because there was no need to do so.

Ali Naimi said he was "concerned about the (price) level" and suggested Saudi Arabia is ready to raise production if the kingdom determines supply-and-demand fundamentals have changed. But for now, the minister told reporters, "all our buyers are satisfied and happy."

Traders were also keeping an eye on storms brewing offshore.

So apparently there are a lot of other factors contributing to the rising cost of gas and crude oil. Nevertheless, oil companies in the US and (I imagine) other countries have been making record profits off of it.

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revel wrote:

The keyword there is unreasonable profit. The profits the oil companies have been making at the expense of ordinary americans have been obscene.
...
apparently there are a lot of other factors contributing to the rising cost of gas and crude oil. Nevertheless, oil companies in the US and (I imagine) other countries have been making record profits off of it.

What kind/size of profit constitutes an unreasonable or obscene profit? Is it a big profit in dollars, or is it a big profit in terms of percent of costs.

Suppose the total cost paid by the grocery store for growing, harvesting, transporting, and selling the groceries you bought 12 months ago was $100. The average markup on groceries sold by grocery store chains is about 3%. So your total price last year would have been $100 x 1.03 = $103.

Suppose the total cost paid by the grocery store for growing, harvesting, transporting, and selling the groceries that you bought this week was higher by a factor of 7, or $700. So your total price this week would have been $700 x 1.03 = $721.

Who deserves the most blame? The growers? The harvesters? The transporters? The seller?

Doesn't it depend on who is responsible for the greatest increase in cost? Obviously the seller, the grocery store, is not responsible for the greatest increase in cost.

In the case of crude oil, it is the drillers and lifters who are responsible for the greatest increase in cost, not the transporters, gasoline refiners, or gas stations, even though the fuel markup is about 8%.

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Profit means the amount of money you make after cost. The reports of the last few years have been that the oil companies have been making record profits. So regardless of cost for the oil companies they still have been making record profits. We have been paying more and more at the pump. The two may not directly related but its a true statement nonetheless.

The point to all this is you said that if oil companies do well then it follows that Iraqis will do well. I merely pointed out that hasn't been the case here and it more than likely won't be true there.

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As revel stated, it's about "record" profits while most businesses and people are losing business and ability to purchase energy and food. It's obscene because our government also gives oil companies subsidies even while they make "record" profits.

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revel wrote:

The point to all this is you said that if oil companies do well then it follows that Iraqis will do well. I merely pointed out that hasn't been the case here and it more than likely won't be true there.

Actually, I said:
If American oil companies do well in Iraq then it follows that Iraqis will do well.

All of the Iraqis are share holders of the oil lifted in Iraq. If American oil companies do well in Iraq then it follows that more oil will be lifted in Iraq. If more oil is lifted in Iraq, then it follows that individual Iraqis will receive more compensation for the oil shares they own. If individual Iraqis receive more compensation for the oil shares they own, then it follows that Iraqis will do well.

The same logic is valid for Americans who own shares of oil companies. If American oil companies do well in America, then it follows that Americans who own shares of American oil companies will do well.

cicerone imposter wrote:

it's about "record" profits while most businesses and people are losing business and ability to purchase energy and food. It's obscene because our government also gives oil companies subsidies even while they make "record" profits.

Let's get our government to cancel any alleged subsidies of oil companies. Government subsidies of any private business are obscene. American oil company profits are record profits because our government has limited growth in the amount of oil lifted in America and thereby made us victims of the OPEC cartel. This too is obscene. If our government would end both obscenities, the cost of oil purchased by oil companies would decrease.

I say, let the oil companies continue to make almost 8% profit on their costs, but find a way to decrease those costs. One way to decrease those costs is to encourage the oil companies to invest their profits in more domestic oil drilling, more domestic oil lifting, and more domestic oil refining. The way to do that is obviously tell our government to stop limiting domestic oil drilling, lifting, and refining.

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Talking to you Ican is a painstaking thankless effort. You just ignore what you want and keep repeating the same things as though it hasn't been debunked.

I seriously doubt that many Iraqis are going to be able to afford to buy shares in the oil companies. Where do you get all of Iraqis are share holders in American oil companies? From what source are you able to make such a blanket extraordinary statement? I imagine it will just be corrupt deals going on where a few will profit while most of Iraqis will get the shaft; just like we do here at home.

It seems to me with oil companies making record profits there is no need to reduce their cost any further.

I am not saying that private companies should not get contracts in Iraq. I am saying that it should be fair bidding for all oil companies through out the world and Iraqis should be making the decisions themselves without any influence or manipulation from countries outside of their own. From what I have been reading that has not been the case.

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Revel, you have not debunked what I have said. So I will continue repeating what I've said--with more detail and supplementary arguments--until you either actually debunk what I say, or until you recognize that I have actually debunked what you have said.

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ican as usual doesn't know what he's talking about. Many Iraqis are suspicious of oil contracts with American companies. How can Iraqis own stock when the government is in control and not publicly held? Is that a new theory on capitalism?

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Nigeria...has the potential to be a major source for oil to the rest of the world. But the government is corrupt. The oil companies and the U.S. government seem to have no interest in seeking to remedy a situation in which the average Nigerian earns a dollar a day.

Mexico...has the potential to be a major source of oil to the rest of the world. But the government has allowed the industry to fall into disrepair.
The oil companies and the U.S. government seem to have no interest in helping to restore that infrastrucure.

Iraq? Drilling for more in the U.S? Why not fix the problems rather than creating new ones?

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revel wrote:

Talking to you Ican is a painstaking thankless effort. You just ignore what you want and keep repeating the same things as though it hasn't been debunked.

I seriously doubt that many Iraqis are going to be able to afford to buy shares in the oil companies. Where do you get all of Iraqis are share holders in American oil companies?

I didn't say all of Iraqis are share holders in American oil companies. I said:
All of the Iraqis are share holders of the oil lifted in Iraq. If American oil companies do well in Iraq then it follows that more oil will be lifted in Iraq. If more oil is lifted in Iraq, then it follows that individual Iraqis will receive more compensation for the oil shares they own. If individual Iraqis receive more compensation for the oil shares they own, then it follows that Iraqis will do well.

From what source are you able to make such a blanket extraordinary statement? I imagine it will just be corrupt deals going on where a few will profit while most of Iraqis will get the shaft; just like we do here at home.

I thought you already knew that the Iraq government has granted each and every Iraqi a share of each and every barrel of crude oil lifted in Iraq. It's no secret. It's been well publicized.

It seems to me with oil companies making record profits there is no need to reduce their cost any further.

Do yourself a big favor and think!

Oil company profits equal a percentage of their costs. If the price per barrel of crude oil decreases, then the oil companies will make less profit per barrel of crude oil. If the price per barrel of crude oil increases, then the oil companies will make more profit per barrel of crude oil.

I am not saying that private companies should not get contracts in Iraq. I am saying that it should be fair bidding for all oil companies through out the world and Iraqis should be making the decisions themselves without any influence or manipulation from countries outside of their own. From what I have been reading that has not been the case.

I thought the Iraq government made these decisions about which companies to select to lift their oil. If not, then who did? In any case I agree that these decisions are not rightfully the American government's, or the American oil companies'. These decisions are rightfully the Iraq government's.

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revel wrote:

Talking to you Ican is a painstaking thankless effort. You just ignore what you want and keep repeating the same things as though it hasn't been debunked.

I seriously doubt that many Iraqis are going to be able to afford to buy shares in the oil companies. Where do you get all of Iraqis are share holders in American oil companies?

I didn't say all of Iraqis are share holders in American oil companies. I said:
All of the Iraqis are share holders of the oil lifted in Iraq. If American oil companies do well in Iraq then it follows that more oil will be lifted in Iraq. If more oil is lifted in Iraq, then it follows that individual Iraqis will receive more compensation for the oil shares they own. If individual Iraqis receive more compensation for the oil shares they own, then it follows that Iraqis will do well.

From what source are you able to make such a blanket extraordinary statement? I imagine it will just be corrupt deals going on where a few will profit while most of Iraqis will get the shaft; just like we do here at home.

I thought you already knew that the Iraq government has granted each and every Iraqi a share of each and every barrel of crude oil lifted in Iraq. It's no secret. It's been well publicized.

It seems to me with oil companies making record profits there is no need to reduce their cost any further.

Do yourself a big favor and think!

Oil company profits equal a percentage of their costs. If the price per barrel of crude oil decreases, then the oil companies will make less profit per barrel of crude oil. If the price per barrel of crude oil increases, then the oil companies will make more profit per barrel of crude oil.

I am not saying that private companies should not get contracts in Iraq. I am saying that it should be fair bidding for all oil companies through out the world and Iraqis should be making the decisions themselves without any influence or manipulation from countries outside of their own. From what I have been reading that has not been the case.

I thought the Iraq government made these decisions about which companies to select to lift their oil. If not, then who did? In any case I agree that these decisions are not rightfully the American government's, or the American oil companies'. These decisions are rightfully the Iraq government's.

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THE US, THE UN AND IRAQ, ELEVENTH THREAD

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