Whilst world petrol prices rise, it is no secret that oil companies are making bumper profits at the expense of their customers. For all the talk of belt-tightening and concern about market stability, high oil prices bring delight to the energy barons because they can pump up end user prices whilst claiming that they are only responding to changes on world markets. Now, as if to show off to the world just how awash it is in cash, ExxonMobil, the fattest of the fat, has awarded its former CEO a retirement package worth four-hundred million dollars. This makes the paltry fifteen million Katie Couric is getting to read the news at CBS seem almost normal. This package adds a whole new meaning to “put a tiger in your tank”.
I understand that ExxonMobil, made up of the two primary descendants of the reviled Standard Oil Trust, wishes to reward its former Chief Fat Cat™ for a job well done, even though he had little (or did he?) influence over the price of crude oil, but how is such a figure even remotely justifiable? Are they rewarding him for thoroughly screwing everyday men, women and children who are ever more reliant on fossil fuels for the basics of daily life? Or is this some sort of an obscene game of oneupsmanship between them and the other oil majors whose profits were not quite as stellar?
Exxon’s generosity towards Mr Raymond is not limited to his platinum parachute. His 2005 compensation package was worth just over fifty-one million dollars and in 2004, he received a bonus of three-point-six million dollars. Despite this, Chief Fat Cat™ Raymond testified before Congress that “We’re all in this together, everywhere in the world” when the sharpest woman in the Senate, California Democrat Barbara Boxer, grilled him about why petrol prices were so high.
I don’t know about you, but if we’re all in this together, I think I should be allowed the use of the Exxon jet that is being made available to Mr Raymond as part of his retirement package and I think the company should send along a car and driver to shuttle me about too. I read last year in Daniel Yergin’s book on the oil industry “The Prize” about how one former Exxon CEO refused a filling station owner’s offer to let him jump the queue during the 1973 oil crisis. While this refusal may have been somewhat cynical when even then the company was cashing in on high oil prices, at the very least there was a shred of humility in the man, unlike the shocking hubris of Chief Fat Cat™ Raymond and company.
ExxonMobil defends the package, pointing out its spectacular stock performance during Raymond’s watch as well as the record thirty-six-point-one billion dollar profit they recorded for 2005. To put things into perspective, Exxon’s profit in 2005 amounted to six dollars for every single human being on the planet. Put another way, this astronomical profit was enough to buy almost 45 gallons of petrol (at $2.75/gallon) for every man, woman and child in the Evil Empire. This is equal to nearly ten percent of overall consumption for 2004. Of course, company officials point out that the staggering number is merely the result of staggering revenues but only adds up to a profit margin of nine-point-eight percent. The poor folks over at ExxonMobil whinge that their profit margins are far behind those in industries like banking and pharmaceuticals. They fail to point out however, that oil industry profit margins average eight-point-two percent, well outpacing the six-point-eight percent average for overall industry.
After reading such mind-boggling numbers as this, I continue to wonder why corporations are paying so little in taxes. In 2003, corporate taxation acounted for a mere seven-point-four percent of Evil Empire revenues, whilst this figure was thirty-two percent in 1952. Why is this? Why are companies allowed massive windfalls when they set up foreign subsidiaries? Why are they given a dizzying array of tax breaks and straight out handouts from the federal government. And why on earth did the Congress approve billions of dollars in tax breaks and subsidies for oil companies in the 2005 energy bill?
The obvious answer is that two oil men currently occupy the White House. They and all of their cronies are laughing all the way to the bank because the electorate is too blind to see that they are being robbed and too lazy to do anything about it even if they did.