Keep oil companies’ profits in check

I always thought that I knew how to spell “capitalism.” However, it appears that I was wrong. It is spelled G-R-E-E-D. Whenever costs go up for businesses, the profit goes down. A simple equation: selling price less cost. However, for Big Oil the equation is different. Higher oil prices mean higher profits.

How it works is simple. There are 55 gallons of oil in each barrel. At $60 per barrel the price of oil is $1.09 per gallon. When the price of oil goes up to $104 per barrel the cost to Big Oil increases by $44 dollars per barrel or 80 cents per gallon. If the price of gasoline was $2.69 per gallon and we add a mere 80 cents to the selling price, we should be paying only $3.49 per gallon not $4. The difference in price is the “greed factor.” Oil is the same oil at $60 per barrel or at $104 per barrel and costs the same to refine.

Gasoline is not just a commodity; it is a necessity. Years ago, a smarter, more astute and caring Congress put into place something called a “Windfall Profits Tax.” Today our congressional representatives and senators are apparently wimps. They are afraid of Big Oil.

A Windfall Profits Tax would act to lower gas prices at the pump, raise revenue to lower the deficit and balance a budget run amok. However, apparently our representatives and senators do not care about the welfare of their voters. Perhaps, they should go looking for another day job, because come Election Day many of us will spell “capitalism” at the polls.

Michael J. Singer

Arlington Heights