On this page...

• The Lies about Corporate Profits and Taxes

• Tax REBATE?  I think not...

• Myth about "Global Warming" uncovered

• We must STOP CONGRESS before it's too late!

• Health Care a HUGE Issue

• "The Ant & The Grasshopper"  

The Lies about Corporate

Profits & Taxes

March 15, 2008

It’s very interesting that liberal politicians and the media have been able to pull the wool over people’s eyes for so long when it comes to what they call “outrageous profits” and big business not “paying their fair share” in taxes.

So, what’s fair?  Shouldn’t a company, regardless of its size, be able to make a profit?  After all, that’s why people start up businesses — they feel they have a great idea and a “market” for a product or service, they seek independence, they want to build something for themselves, and they want to make money (profit). 

We have been told for years that oil companies are gouging the public, raking in huge profits.  We’ve also been told that they don’t pay enough in taxes.  And, if you are told a lie often enough, you begin to believe that it is the truth.

The amount of the profit seems to convince many that a company is “making too much” at the expense of the consumer.  In the case of Exxon, their $40.6 billion in profit sounds excessive, unless you consider the volume of product they sell worldwide, and the number of customers they serve.

According to Yahoo! Finance, Exxon showed a profit margin for 2007 of 11.23%.  That number is in the area of where a successful company should be in order to provide its owners with some income for their efforts or investment, and to stay in business.  Show me a business that doesn’t have a 10% or better profit margin, and I’ll show you a business that is going out of business.

For 2006, Exxon paid out dividends (a share of the profits) to stockholders (owners) all over the world.  Some of the people reading this newsletter may own stock in Exxon, either outright or through their pension or retirement plans.  The stockholders are receiving a return on their investment — and with 5.35 billion shares outstanding, there are a lot of owners.  For the year 2007, those stockholders received dividends amounting to a little over $7.25 per share.  At a current average price of a little over $85 per share, that’s a “return” of just shy of 8.5%.  That is not an excessive profit for the “owners” to make, and there are other investments out there that pay a greater return.

So, now to dispel the myth that big companies like Exxon pay no taxes.  There are so many people out there that believe that myth that if you Google “Exxon Profits,” you’ll get about 8,000 hits.  Google “Exxon Taxes,” and you’ll get about 300.

The truth is that Exxon paid 41.4% of its taxable income in federal income taxes for 2007 — or $30 billion.

Over the last three years (2004-2007), Exxon, by itself, has paid an average of $27 billion per year in federal income taxes.  According to the IRS, in 2004:

There were 130 million tax returns filed

Total number of tax returns for the bottom 50%: 65 million

Adjusted Gross Income for bottom 50%: $922 billion

Total income tax paid by the bottom 50%: $27.4 billion

The bottom line is this:  one corporation (Exxon) paid as much in federal income taxes in one year than the total paid by the bottom 50% of individual taxpayers — 65 million people!  Further, the tax rate for the bottom 50% of taxpayers is 3% of adjusted gross income — and Exxon paid over 41%.

Remember, we said that the profit margin for Exxon is 11.23%.  They end up with that return after they have invested $208,335 billion on assets, supported 80,800 employees and their families with paychecks and benefits, and paid all of the other costs of procurement of raw product, refining, delivery, state and local taxes (including income, property, and personal property—taxes on equipment and furnishings).

Here in Idaho, we currently pay 13.3% in taxes to the federal and state governments on every gallon of gasoline we buy (25¢ per gallon state and 18.2¢ federal tax, based on the average price per gallon of $3.25).  They take that “profit” without incurring any costs.

There is some truth to the statement that oil companies pay no taxes, however.  Taxes are an expense of doing business.  As such, it is included in the calculations used to come up with the consumer price for the product.  That $30 billion in federal taxes paid by just one company amounts to $99.62 per man, woman and child in the U.S. (based on a population of 301,139.947) OR $229.48 per individual that filed a federal tax return (based on 130,728,360 that filed income tax returns in 2003), and is included in the price you pay (making it a “hidden” tax).

Add this amount to all of the other taxes paid by a company like Exxon and the 13.3% we pay directly in taxes on every gallon we buy — and you’ll quickly discover just who is really gouging us.  Remember, too, that similar “hidden taxes” exist for every product we purchase, and you’ll understand why Kent Marmon says “taxes are too high.

”Sources of information:  http://www.hoovers.com/exxon-mobil; Yahoo! Finance @ http://finance.yahoo.com/q/ks?s=xom; http://finance.google.com/finance?fstype=ci&cid=663876; Seeking Alpha “Exxon’s 2007 Tax Bill: $30 Billion” at http://seeingalpha.com/article/63131-exxon-s-2007-tax-bill-30-bllion… U.S. Census Bureau; wikipedia.org; Fortune 500 Global

Myth about "Global Warming" uncovered

March 15, 2008

In an article, “Forget global warming: Welcome to the new Ice Age,” Lorne Gunter of the National Post says that “snow cover over North America and much of Siberia, Mongolia and China is greater than at any time since 1966.

Todd Dvorak, an Associated Press writer, in an article entitled “Robust snowpack has officials optimistic” in the Idaho Press-Tribune on Thursday, March 13, 2008, tells us that “some levels [of snow] in north Idaho are 200 percent of average,” with snowpacks at or above 30-year averages in mountain ranges from Coeur d’Alene to Ketchum.”

The article quotes Joe Breidenbach, senior hydrologist for the National Weather Service as saying, “the water supply numbers are looking quite good.  We should see some improvement there in long-term drought.”

Idaho Water Resources Director David Tuthill “told lawmakers that healthy snowpack lessons the likelihood the agency would issue curtailment orders this summer for southern groundwater pumpers.”

In the National Post article, Gunter says that “the U.S. National Climatic Data Center (NCDC) reported that many American cities and towns suffered record cold temperatures in January and early February.  According to the NCDC, the average temperature in January ’was -.0.3°F cooler than the 1901-2000 (20th Century) average.’”

Gunter continues, “China is surviving its most brutal winter in a century.  Temperatures in the normally balmy south were so low for so long that some middle-sized cities went days and even weeks without electricity because once power lines had toppled, it was too cold or too icy to repair them.

There have been so many snow and ice storms in Ontario and Quebec in the past two months that the real estate market has felt the pinch as home buyers have stayed home rather than venturing out looking for new houses.

In just the first two weeks of February, Toronto received 70cm (27.6”), smashing the record of 66.6cm (26.2”) for the entire month set back in the pre-SUV, pre-Kyoto, pre-carbon footprint days of 1950.

The ice is back.”

The senior forecaster for the Canadian Ice Service in Ottawa, Gilles Langis says that the ice “has not only recovered, it is actually 10 or 20cm (3.9 to 7.9 inches) thicker “in many places than it was this time last year.”

Gunter says, “OK, so one winter does not a climate make.  It would be premature to claim an Ice Age is looming just because we have had one of our most brutal winters in decades.

But if environmentalists and environment reporters can run around shrieking about the manmade destruction of the natural order every time a robin shows up on Georgian Bay two weeks early, then it is at least fiar game to use this winter’s weather stoies to wonder whether the alarmist are being a tad premature.

And, it’s not just the anecdotal evidence that is piling up against the climate-chage dogma.”

Gunter quotes Robert Toggweiler of the Geophysical Fluid Dynamics Laboratory at Princeton University and Joellen Russell, assistant professor of Biogeochemical Dynamics at the University of Arizona — “two prominent climate modelers” — saying, “the computer models that show polar ice-melt cooling the oceans, stopping the circulation of warm equatorial water to northern latitudes and triggering another Ice Age are all wrong.

‘We missed what was right in front of our eyes,’ says Prof. Russell.  ‘It’s not the ice melt but rather wind circulation that drives ocean currents northward from the tropics.  Climate models until now have not properly accounted for the wind’s effects on ocean circulation, so researchers have compensated by over-emphasizing the role of manmade warming on polar ice melt.’

Last month, Oleg Sorokhtin, a fellow at the Russian Academy of Natural Sciences, shrugged off manmade climate change as ‘a drop in the bucket.’  Showing that solar activity has entered an inactive phase, Prof. Sorokhtin advised people to ‘stock up on fur coats.’

He is not alone.  Kenneth Tapping of our own National Research Council, who oversees a giant radio telescope focused on the sun, is convinced we are in for a long period of severely cold weather if sunspot activity does not pick up soon.

The last time the sun was this inactive, Earth suffered the Little Ice Age that lasted about five centuries and ended in 1850.  Crops failed through killer frosts and drought.  Famine, plague and war were widespread.  Harbors froze — so did rivers — and trade ceased.

It’s way too early to claim the same is about to happen again — but then it’s way too early for the hysteria of the global warmers, too.”

From an article by Lorne Gunter of the National Post—published Monday, February 25, 2008  http://www.nationalpost.com/opinion/columnists/story.html?id=332289

The Ant & The Grasshopper

There are two different versions, with two different morals of the story of the Ant and the Grasshopper.

Old Version:

The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter.

The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.

Come winter, the ant is warm, and well fed.

The grasshopper has no food or shelter, so he dies out in the cold.

Moral of the story:  Be responsible for yourself!

Modern Version:

The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter.

The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.

Come winter, the shivering grasshopper calls a press conference and demands to know why the ant should be allowed to be warm and well fed while others are cold and starving.

CBS, NBC, PBS, CNN and ABC show up to provide pictures of the shivering grasshopper next to a video of the ant in his comfortable home with a table filled with food.  America is stunned by the sharp contrast.

How can this be, that in a country of such wealth, this poor grasshopper is allowed to suffer so?

Kermit the Frog appears on Oprah with the grasshopper, and everybody cries when they sing, "It's Not Easy Being Green."

Jesse Jackson stages a demonstration in front of the ant's house where the news stations film the group singing, "We Shall Overcome."  Jesse then has the group kneel down to pray to God for the grasshopper's sake.

Nancy Pelosi and John Kerry exclaim in an interview with Larry King that the ant has gotten rich off the back of the grasshopper, and both call for an immediate tax hike on the ant to make him pay his fair share.

Finally, the EEOC drafts the Economic Equity & Anti-Grasshopper Act retroactive to the beginning of the summer.

The ant is fined for failing to hire a proportionate number of green bugs and, having nothing left to pay his retroactive taxes, his home is confiscated by the government.

Hillary gets her old law firm to represent the grasshopper in a defamation suit against the ant, and the case is tried before a panel of federal judges that Bill Clinton appointed from a list of single-parent welfare recipients.

The ant loses the case.

The story ends as we see the grasshopper finishing up the last bits of the ant's food while the government house he is in, which just happens to be the ant'sold house, crumbles around him because he doesn't maintain it.

The ant has disappeared in the snow.

The grasshopper is found dead in a drug related incident, and the house, now abandoned, is taken over by a gang of spiders who terrorize the once peaceful neighborhood.

Moral of the story:  Be careful how you vote in 2008!

Tax REBATE??? I think not...

Congress has passed it, and the President has signed it into "law," but what THEY and the MEDIA call it isn't what it is.

You see, a "rebate" is an amount of money that is given back of an amount paid for goods or services. It has largely been used as a marketing tool as an attempt to make a purchase more attractive -- to get more business.  It's like the $1000 HD television that is "on sale" for only $1500 with a $500 rebate.  You pay $1500, and they send you $500 back. The key here is that the rebate is actually a refund of your money.

This "economic stimulus" that is going to provide taxpayers with "rebates" is not a rebate program when the government has to borrow about $168 Billion to fund it. When the government borrows money, it has to be paid back, and until such time as it is paid back, the government has to pay interest on the loan.

By the way, the government is YOU.

So, in other words, in order to stimulate the economy, Congress has created another program, borrowed money to fund it, and has handed it out under the guise of being a return of your tax dollars -- when, in fact, you, your children or great grandchildren will have to pay it back, as well as all of the interest that accrues on it until it is paid back.

If you're unfortunate enough to be outside the "guidelines" set up for the "rebate" and are not eligible to get any "economic stimulus" cash, don't feel bad.  You haven't been left out.  You still get to pay on the interest and help pay off the debt.

Just to show that they aren't unfair, they are going to give "rebates" to people that haven't even paid any federal taxes, as long as they made at least $3000 last year and filed an income tax return.  Of course, they'll also get their Earned Income Credit, which is "free money" given to them because they didn't make enough through other means.

The ONLY kind of "economic stimulus" that the government should be involved in is reducing the size of government, cutting government spending, and lowering taxes on ALL taxpayers. 

They should free up OUR money so that we can determine what WE want to do -- what is best for OUR families, what charities WE want to support, so we can pay for our own health care OF CHOICE, so we can expand our businesses and create more jobs and opportunities, etc.

This entire "rebate" thing is just the latest in government meddling, government expansion, and spending more than they take in.  Worse than that, though, is it is just another LIE being spread to the American people who are eager to see more money in their pockets.  Most people don't care where it's coming from -- or that it'll cost them in increased taxes to pay it off -- they're just happy to get it.

It's how elections are won, you know.  And, THIS Congress needs all the help it can get to get re-elected.  It has suffered the lowest approval ratings in history.  This will help them "move up" a little in popularity -- even if it is the wrong thing to do.

Health Care a HUGE Issue

March 15, 2008

The availability of affordable health care in the United States has been a topic of discussion over the past several years, and a “new direction” for solving the problem surfaced during the Presidency of Bill Clinton, when then-First Lady Hillary began an effort to create a nationalized health care system.

As a United States Senator, Hillary introduced her plan that included a price tag for American taxpayers of about $110 billion.

Her plan as a candidate for President has increased in price to some $400 billion.  According to an article in the March 10, 2008 issue of Newsweek, “Clinton wants to extend health care to every American.  She’d use tax credits to limit premiums to a fixed percentage of family income and expand rolls of Medicaid and the SCHIP children’s coverage program.”  The article says that costs to the federal treasury would “likely exceed $100 billion per year.”

Barack Obama’s plan calls for “let[ting] individuals and small businesses buy health care benefits similar to the ones that members of Congress get.  He’d mandate coverage for children.  Families that couldn’t afford rates would be eligible for subsidies, while others would be covered by expanding Medicaid and SCHIP programs,” according to the Newsweek article.  The price tag for Obama’s plan is about $240 billion.

There is no doubt that there are issues to be resolved regarding both affordability of health care, but of the availability of lower cost health care insurance for our families.

However, those that are pushing to “socialize” health care in the United States are providing misleading information through the media in order to further their agenda.

According to an article written March 12, 2008 by Maureen Farrell on the website Forbes.com, “Roughly 63% of all uninsured workers are either self-employed or work for firms with fewer than 100 employees, [according to estimates by] the Employee Benefit Research Institute.  And according to research by the 2007 National Small business Association, only 47% of businesses with fewer than 500 employees offer health insurance, down from 58% in 1997.”

Farrell continues, “While Democrats aim to mandate universal health care (by forcing some companies that don’t provide it to pay a penalty), the NFIB (National Federation of Independent Business) is pushing to drive out enough cost in the system to make providing the coverage a more feasible choice for small business owners.  ‘You can’t mandate something that people can’t afford,’ says Todd Stottlemeyer, president of the NFIB. ‘It’s not that people don’t want to provide coverage, but they can’t afford to.’”

There are other proposals being kicked around, including removal of federal restrictions on the purchase of insurance across state lines, or changing the tax code to allow both employers and individuals to claim deductions for purchasing health insurance.  “Currently, only individuals with employer-sponsored coverage can claim tax deductions,” according to the Forbes article.  It continues, “NFIB proposals include portable health insurance (so people don’t lose coverage when they switch jobs); more transparency on health insurance costs; and policy pooling to spread risk and reduce premiums.”

Kent Marmon believes that giving the marketplace the freedom and flexibility to come up with solutions to the health care crisis should be a high priority in Congress.  “This doesn’t mean that Congress should solve the problem,” Marmon says.  “It (government) needs to get out of the health care and insurance business and allow the experts to create a system that can offer insurance to more people at affordable rates.”

Marmon says, “Government unfunded mandates that require health care entities to provide services to those that can’t afford them, including illegal immigrants, force up the cost of services for those with insurance or the ability to pay.  The results of these practices have been most evident in states that have large populations of illegal immigrants, with hospitals and clinics being forced to close their doors because they can’t afford to stay in business.  Another result of these practices is an increase in health state lines, or changing the tax code to allow both employers and individuals to claim deductions for purchasing health insurance.  “Currently, only individuals with employer-sponsored coverage can claim tax deductions,” according to the Forbes article.  It continues, “NFIB proposals include portable health insurance (so people don’t lose coverage when they switch jobs); more transparency on health insurance costs; and policy pooling to spread risk and reduce premiums.”

Kent Marmon believes that giving the marketplace the freedom and flexibility to come up with solutions to the health care crisis should be a high priority in Congress.  “This doesn’t mean that Congress should solve the problem,” Marmon says.  “It (government) needs to get out of the health care and insurance business and allow the experts to create a system that can offer insurance to more people at affordable rates.”

Marmon says, “Government unfunded mandates that require health care entities to provide services to those that can’t afford them, including illegal immigrants, force up the cost of services for those with insurance or the ability to pay.  The results of these practices have been most evident in states that have large populations of illegal immigrants, with hospitals and clinics being forced to close their doors because they can’t afford to stay in business.  Another result of these practices is an increase in health care insurance premiums for the millions of people that are insured.”

Over the past several years, NFIB has been working with Congress to pass legislation that would lift restrictions to allow the self-employed and small businesses to join together in associations to form large groups so that lower health insurance premiums like those available to large businesses and government entities could be developed by insurance providers.  During George W. Bush’s first term, the House passed this type of legislation several times, only to have it rejected in the Senate.  The President had pledged to sign the legislation into law if Congress would simply deliver it to his desk.  “Passage of that type of legislation would make insurance more affordable for some 25,830,000 (25.8 million) people,” Marmon says.

As for lowering the cost of health care, which would result in lower insurance premium amounts, Marmon says, “Congress needs to look closely at the tort process that allows an enormous number of people to sue health care providers for anything they consider to be malpractice.  Whether or not judgment is in favor of the plaintiff, the cost of defending the health care provider(s) that were sued is paid by insurance companies that cover providers in such cases.  That forces the premiums up for coverage — and those high premiums are added to the cost of doing business, thus increasing health care costs for everyone.”

Unfunded mandates, restrictions on insurance products, and lawsuits that increase the cost of providing care are just a few of the problems that need to be addressed.

The cost of medications (pharmaceuticals) is another area of great concern to Americans.  Pharmaceutical companies spend hundreds of millions of dollars in the development of new or advanced drugs, and millions more in gaining approval through the huge FDA bureaucracy.  Hundreds of millions more are paid in premiums to insurance companies to protect them from lawsuits by individuals that develop other complications or die as a result of complications attributed to the use of those drugs.  And, the taxes paid by these companies to various governmental bodies are in the millions, as well.  All of these costs are included in the prices charged to consumers.

“The marketing isn’t cheap, either,” Marmon said.  “Have you ever noticed that the warnings and lists of possible complications take up nearly half of the advertisement?  They do that to warn the public, but also in an attempt to protect themselves from suit.”  Of course, marketing costs are a part of doing business, too, and end up in the price tag at the pharmacy.

“It isn’t unreasonable to consider a non-profit organization similar to the Consumer Reports model to replace the FDA that could provide the same type of oversight without taxpayer support, saving us millions of dollars a year.”

Finding ways to make health care and related costs more affordable and accessible to Americans is of dire importance and should be a high priority for the next Congress.

Kent Marmon believes strongly that another government bureaucracy is not the solution to the health care crisis that exists across the nation.  He says, “all we need to do is look at the dismal record of the federal government’s management of our military hospital facilities to know that a government solution is not the answer.  It’s a fact that every time a bureaucracy is created, it grows and grows until it becomes both ineffective and unaffordable.”

“People must not have their freedom of choice in health care services or providers regulated, controlled or rationed as it is in Socialized societies where ‘national health care’ is practiced.  Government’s role should be limited to making sure that the private sector and marketplace have the freedom to create the best, most efficient system possible, so that health care professionals can continue to deliver the finest health care and medical research available in the world today,” Marmon said.