Who Makes More - Oil Companies or Government

Everyone's in a tizzy about gas prices, with many calling for investigations into the "windfall" profits the oil companies have experienced due to the soaring prices. But when gas prices rise, who profits more - the oil companies or the government?

While the media continues to blame the big oil companies for gouging U.S. motorists as they collect record breaking profits, the windfall profits raked in by the government in the form of energy tax revenue actually dwarf the oil companies' jackpot.

The press sounded the alarm last year when the largest U.S. oil company, ExxonMobil Corp, announced profits of $36 billion. But according to the Tax Foundation, the biggest price gouging profiteer was the U.S. government, cashing in to the tune of $54 billion in oil and gas taxes.

"Tax collections on the production and import of gasoline by state and federal governments are already near historic highs," the think tank says. "In fact, in recent decades governments have collected far more revenue from gasoline taxes than the largest U.S. oil companies have collectively earned in domestic profits."

Perhaps the government should consider waving their taxes for a little while. In California that would dramatically decrease prices, as I'm sure it would in most of the country. Instead of boycotting Exxon as one Texas county is proposing, maybe the boycott should be directed at the government as well.

Speaking of a boycott against Exxon, one commentator pointed out today that even if consumers stopped bying gas at Exxon/Mobil stations, the company isn't merely going to throw their excess gasoline away. They'll simply sell it to other distributors, and probably make more money in the process than they would have selling it at local gas stations. Boycotts are silly, and this one clearly won't work.